During March and April, China announced a series of bilateral trade agreements with Russia, Saudi-Arabia and Brazil, in which the countries pledged to settle trade in their respective currencies rather than in the dollar. These developments led to an avalanche of commentary in the financial press about the imminent demise of the dollar, and the subsequent implications for the global financial system. These stories pop up every few years and they rarely come to anything. I have heard at least ten such stories in a near twenty-year career, and each time they generated more heat than light. However, I think…

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