Welcome to the end of Brenton Woods and the Washington Consensus that defined the world money systems around U.S. controlled institutions and the U.S. dollar as the sole reserve currency.
Germany, France and Italy said on Tuesday they had agreed to join a new China-led Asian investment bank after close ally Britain defied U.S. pressure to become a founder member of a venture seen in Washington as a rival to the World Bank.
The concerted move to participate in Beijing's flagship economic outreach project was a diplomatic blow for the United States, reflecting European eagerness to partner with China's fast-growing economy, the second largest in the world.
It comes amid prickly trade negotiations between Brussels and Washington, and at a time when EU and Asian governments are frustrated that the U.S. Congress has held up a reform of voting rights in the International Monetary Fund due to give China and other emerging economies more say in global economic governance.
Especially under the Obama administration the U.S. abused its important role in international finance to further its political pet projects at the cost of other participants in the system.
On Washington's insistence the International Monetary Fund is breaking its rules to finance a civil war in Ukraine. U.S. spying on the SWIFT banking information exchange is used to sanction U.S. enemies by excluding them from the international banking system. Foreign banks get punished with huge fines because they conduct business with countries the U.S. sees as unpalatable. Wall Streets huge mortgage scam and selling of worthless derivatives to foreign entities left the world economy in shambles and investors and whole countries bankrupt but went completely unpunished.
Enough. Over time the world will no longer adhere to the rules set in Washington. The global banking system will evolve into a multipolar system where different public international banks will act and where monetary information exchanges can be conducted on various systemsunder various jurisdiction.
This will be a huge loss to the coercive power of the U.S. and thereby a good step towards a more Westphalian world where power is more equally distributed. International sanctions against countries that defy U.S. regime change orders will no longer be sustainable.
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