Russian response to US threat of sanctions

While the US considers economic sanctions on Russia, potentially freezing their assets in America and the SWIFT banking system, it appears that the US has far more to lose than Russia does. If the US confirms its stupidity by implementing such a plan, this would no doubt mark the death of the dollar as a world currency.

http://news.yahoo.com/kremlin-aide-says-u-may-face-consequences-sanctions-081027180--finance.html

MOSCOW (Reuters) - A Kremlin aide was quoted on Tuesday as saying that if the United States were to impose sanctions on Russia over Ukraine, Moscow might be forced to drop the dollar as a reserve currency and refuse to pay off any loans to U.S. banks….

"In the instance of sanctions being applied to stated institutions, we will have to declare the impossibility of returning those loans which were given to Russian institutions by U.S. banks," RIA quoted Glazyev as saying.

"We will have to move into other currencies, create our own settlement system."

He added: "We have excellent trade and economic relations with our partners in the east and south and we will find a way to reduce to nothing our financial dependence on the United States but even get out of the sanctions with a big profit to ourselves."

If I recall, Russia is holding about $300 billion in US currency reserves. What would happen to the dollar if Russia dumped the dollar on the open market?

Further, the BRICS nations have already set up their own “settlement system,” where they can pay debts and transfer money between themselves directly without going through the Federal Reserve’s SWIFT system. This has been established ever since the US and Europe decided to place sanctions on Iran. Iran now trades oil for gold from nations like China and India. Our sins of the past are now catching up to us.

Our government officials think they are taking aim at Russia, when in fact, they are shooting at their own foot.