Tag: brics

G7 v BRICS: is this how the sides will line up for World War Three?

Photo by Rags Fehrenbach on Pexels.com

We know we started out as a science based blog, mainly devoted to the encouragement of more research into antibiotics. If our brief has widened a little, it is because we cannot ignore the wider world around us. If that world decides to spend more on weapons of mass destruction, and less on antibiotic research, it impinges directly on us and our readers. Which is why this pair of articles from the Guardian caught our eye. They strongly suggest that the sides for the next world war are lining up. And the outcome is by no means certain.

On the one hand are the G7 group of countries, led by the USA.[1] Thirty years ago they had the game in their hands. Immensely rich, accounting for an enormous slice of the global pie, their triumph over the Communist bloc had seemed to set them apart . They were the world’s bankers, the world’s policemen, the world’s shop keepers. Since when, hubris seemed to set in and it has been downhill all the way. Iraq, financial crash, tariffs, Brexit…………These words are shorthand, metanymies if you will, for a deep moral rot that is grounded in an almost childlike reverence for the supremacy of financial markets and the sorts of people who work in them. Now as the admirable Joseph Stiglitz and his colleagues observe, the once mighty G7 is in danger of being little more than a front organisation for the interests of large American multinationals. A position sure to alienate many around the world.

Among the alienated are a group which starting out as the BRICS (Brazil, Russia, India, China and South Africa)[2] has expanded to include rising stars such as Indonesia. It may not be morally perfect either(its stance on Ukraine, and the fact that many members are autocracies cannot be overlooked). But its members are united on one thing: they are tired of the whims and policy lurches of the US, particularly under such a nakedly self-serving President as the current one. They are ready to have done with the traditional instruments of US domination such as the Reserve Dollar. And they are developing the economic resources to make these ambitions feasible.

History has two lessons. The decline of one hegemonic power and the rise of another is usually a signal of impending war. Another is the formation of alliance blocks; as one small event triggers a chain reaction of consequences. Think Europe 1914 as the case example for both. And don’t expect the supply of antibiotics to go up any time soon.

[1]https://www.theguardian.com/business/2025/jul/02/the-g7-has-once-again-put-multinationals-profits-over-the-interests-of-people?CMP=Share_iOSApp_Other

[2]https://www.theguardian.com/commentisfree/2025/jul/13/the-guardian-view-on-brics-growing-up-a-new-bloc-seeks-autonomy-and-eyes-a-post-western-order?CMP=Share_iOSAp

#G7 #BRICS #China #USA #IMF #dollar #geopolitics #brasil #russia #indonesia

In a world without a reserve currency, Gold is King

It is June 2025, and the world has learned that it no longer has a reserve currency, a role hitherto held by the US Dollar. The chain of events which began with the election of Donald Trump by a disputed majority in the Electoral College (readers will recall he lost the popular vote) have now reached their logical conclusion. You will also remember how attempts to enforce the result by the US Supreme Court could not be accepted by some States who alleged, with some justification, that the Court was no longer an objective and unbiased institution, Their de facto secession, pending a recount, undermined the integrity of both the US Treasury and Federal Reserve. Meanwhile, attempts by the Provisional Trump Administration to impose import tariffs (20% on all comers, 60% on China) have only led to a retaliatory fire sale of Treasury Bonds and other US assets, which led to this morning’s news of the suspension of dollar convertibility. The United States of America (or rather the three new nations into which it seems to be splitting) is no longer at the centre of the world’s financial system.

But, as of this summer of 2025, do we still have a world financial system? Attempts by the BRICS nations to set up their own reserve must end in failure. The lack of transparency in their systems(one or two are more or less open kleptocracies) mean that no one dare trust them to hold their money . The Euro area is too small and fragmented to possibly bear such a role, and their can be other candidates. How can world trade now be anything more than a slightly sophisticated form of barter?

Yet there is one measure by which value is judged. And always has been. Gold has been prized as the ultimate yardstick of worth by humans, and has been by for millennia. It is transportable, it is tradeable, and its price is known at once by everyone in the market. History suggests that world trade works best when most reserves are held by a single, hegemonic power(think Britain before 1914 or the US before 1971) But even if the world’s gold is diffused across the vaults of many competing nations and empires, it can still provide a standard against which everyone can measure the value of their trades. Expect its price to rise now for the rest of 2025, and perhaps even more next year.

#US dollar #world trade #BRICS #reserve currency #gold