I watched an interview today with economist Yanis Varoufakis about Trump's tariffs. He thinks that the actions and purpose are equivalent to the Nixon shock of 1971 that eliminated the convertibility of the U.S. dollar to gold resulting in the U.S. dollar becoming a fiat currency. In short, the dollar changed from representing something tangible to representing the good faith of the United States, but that also enables the Federal Reserve to print as much currency as it wishes. #

The action created a floating exchange between the dollar and other currencies and it made the U.S. dollar the global reserve currency. As the global reserve currency the dollar is what is used by most countries in the world when buying goods and services with other countries, and it is what provides the U.S. with economic power over other countries in the world. Shutting off the flow of U.S. dollars to a country impacts that country's ability to trade with other countries.#

The action also decreased the value of the dollar and that resulted in an increase in the flow of capital in to the United States from other countries, but that increased flow also increased inflation and did not result in more jobs. Varoufakis says that Trumps actions have increased the flow of capital in to the United States but that is translated to rent-seeking rather than job growth.#

In other words, it is a scheme created by bankers for the wealthy to become wealthier and address a risk of United States losing economic power over other countries in the world under the claims increasing jobs for the middle-class. Nixon's actions and subsequent actions take by every President since has destroyed the middle-class in the United States. #