There is a looming crisis that can turn the United States into a 3^rd World Country overnight. This crisis is the collapse of the US dollar. The United Nations along with Syria, Iran, Russia, China and the Oil Producing Arab States are all calling for a global currency to replace the unstable dollar. China and Russia dumped the US dollar in December of 2010 and began trading in the Russian ruble and Chinese yuan.

There are two prominent reserve currencies today: the US dollar and the Euro.  These two reserve currencies comprise the bulk of all assets held by foreign governments, and both are used as the standard savings mechanism for smaller and lesser developed countries.

After the Second World War the United States dollar, then backed by gold, served as an essential central medium of exchange. Most European nations now use the Euro as a secondary reserve currency of choice.

The Federal Reserve has made large-scale purchases of long-term US bonds (Quantitative Easing) — essentially printing billions of dollars. This is causing countries holding US dollars to look for a new reserve currency.

A number of countries hold a significant portion of the US debt, which is essentially in the US dollar.  Should China, the largest owner of US debt sell its holdings, the dollar would plummet drastically overnight.

A recent United Nations report says the dollar’s movements have been too erratic to hold value and the U.N. urges central banks to replace it.

What will be the result of the dollar loosing reserve status:

• The dollar’s value will plunge overnight
• US credit markets will collapse
• US interest rates will soar
• The price of Oil, Food and Consumer Products will grow steeply
• The price of gold and other precious metals will explode
• The US will experience hyperinflation