Name: Trump has no idea what's about to happen
Uploaded: 2025-07-21T19:06:19.000Z
Duration: 14 min 43 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

The United States is not ready for what's about to happen.

Reflexive pronouns

Donald Trump is furious that more and more countries are aligning themselves with BRICS countries and are threatening to ditch the dollar.

And Donald Trump is threatening to impose on those countries additional tariffs to stop them.

But what if I told you that Donald Trump is doing almost everything possible to destroy the dollar as the global reserve currency.

Maybe he is not doing that intentionally, but if you look at what Donald Trump has been doing recently, it is actually putting the United States on a path where in 10 to 20 years from now, the dollar will no longer be the global reserve currency.

And if that happens, it will have devastating impact on the entire US economy.

Recently, Donald Trump said that any country that will align itself with BRICS countries will be subject to another 10% of tariffs.

And this is the problem, nothing will threaten the dollar as much as tariffs.

If you think that I am exaggerating, just watch this video till the end and I will explain everything step by step how tariffs are destroying the United States' dominance over the global economy.

If you are ready, give this video a thumbs up and let's jump right into it.

Donald Trump has recently sent similar letters to multiple different countries, this one to South Korea.

Starting on August 1, 2025, we will charge Korea a 25% tariff.

Everything that will be sold by South Korea into the United States will rise in price by 25%, giving the government an extra revenue but making South Korean products much more expensive.

And that's because the United States is running a huge trade deficit with South Korea and multiple other countries.

And that's why similar letters have been sent to many other countries as well.

In fact, if you look at the United States trade balance, you will see that over the last 5 to 7 decades, United States has been running a persistent deficit with almost every single country.

And that's why everything that Donald Trump is saying about trade deficit between the United States and other countries is true.

And a trade deficit basically means that United States is buying from those countries far more than they are buying from the United States.

And if we balance that and force those countries to buy from the United States as much as the United States is buying from them, United States economy will grow much bigger.

And it also means that, in order to avoid the tariffs, those companies from other countries will move to the United States and manufacture their products in the US, providing jobs in America, growing the economy in America, which overall will result in a much bigger economy.

However, the main question is that, are trade deficits are good or bad?

Is it bad that the United States is running such a huge trade deficit?

Well, we have to understand how trade deficit works in the first place.

Every single country today has a fiat currency.

A fiat currency is not backed by anything, by gold, silver, or any other commodity.

It's simply a piece of paper that is being issued by the central bank of any particular country.

In the US, it's issued by the Federal Reserve.

And in order to give that currency a value, there must be demand for that currency.

Within country, it's easy to control that, because the government says that this is the currency that everybody uses, so you automatically create a demand for it.

But if that country starts overprinting that money, then you are creating oversupply of that currency in the market, which is going to cause either massive inflation, and in some cases, it can even cause hyperinflation, which will make the currency not valuable at all, which is why it's very important to balance the currency's demand and supply in the market to keep its value.

However, what happens when that country starts trading with other countries?

If you want to buy something from some country, let's say you want to buy something from China, in order to buy that smartphone from China, you have to buy the local currency.

And the currency in China is the Chinese Yuan.

So you use your dollars, and you buy the Chinese Yuan to buy the Chinese smartphone.

And that will strengthen the Chinese currency.

The more goods China sells to other countries, which means that China has to produce those goods, make sure that they are price competitive, and make sure that other countries want to buy those goods from China.

The more they will sell, the more foreign currency they will get.

And more Chinese Yuan will be purchased by other countries, which is why China will run a trade surplus, which is going to strengthen its currency.

Because in order to buy Chinese products, you have to buy the Chinese Yuan first.

And that will make the Chinese economy stronger, and the average Chinese will become richer.

On the other side, if China wants to buy foreign goods, for example, from Japan, then they have to use the Chinese Yuan in order to buy Chinese Yen to buy Japanese cars.

And that will create a deficit, and that means that less demand for the Chinese Yuan, since you are using the Chinese Yuan, or you are creating more Chinese Yuan in order to buy the Japanese Yen.

And that will make the Chinese economy poorer, which means that the average Chinese will become poorer.

So if you want other countries to have a demand for your currency, for you to have a stable currency, then you have to produce goods and services that other countries want to buy from you.

Otherwise, why would there be any kind of a demand for your currency.

And that works for every single currency.

And that's why every single country in the world is trying to avoid a deficit and is trying to actually run a surplus in order to get rich.

What made China so rich over the last 50 to 60 years is because they kept building stuff, they kept producing stuff, and they kept selling them to the rest of the world.

For the rest of the world, for example, the United States, to buy the Chinese goods, they had to acquire the Chinese Yuan, which is why the Chinese economy grew so fast over the last 40 to 50 years.

Let's imagine a hypothetical example of a country that does not produce anything at all, but it wants to buy things from other countries.

Now, it does not produce anything, so there is no demand for the currency of this country, but this country keeps printing its fiat currency and keeps buying things from other countries, which keeps making the currency of this country less valuable, which over time makes it absolutely worthless, which over time nobody is going to accept it.

That's why for this country to have a balanced trade between other countries as well, it must produce something that other countries would want to actually buy from it.

And that's why if you look at the United States that it has been running such a huge trade deficit over the last 70 to 80 years, logically, the US dollar should be absolutely worthless today.

No, the US dollar is the most valuable currency in the world.

So what if people will continue buying your currency even if you are producing nothing?

The United States is the global reserve currency because people want to buy it even if they don't want to buy American cars, even if they don't want to buy American bread, even if they don't want to buy the goods and services that America produces.

Because these people are buying US government bonds.

Can you come to the United States and buy government bonds from the US government using the Chinese yuan?

Can you invest in the US stock market with Japanese yen?

No, if Japan wants to invest in the US stock market buying American stocks, they first have to acquire the dollars.

So that creates the demand for the dollar which keeps the dollar so strong.

People all across the globe also want to invest in the US housing market by buying mortgage-backed securities.

So even though that other countries are not buying from the United States in the traditional sense as much as the United States is buying from other countries when it comes to traditional goods and services, there is always demand for the US dollar because everybody wants to sell in the United States.

So the best product or the main export of the United States is investments.

People are buying dollars in order to invest in the United States.

And that's what makes the US dollar the global reserve currency.

How many people buy mortgage-backed securities in China?

How many people invest in the Chinese stock market?

Very few people unless they want to take a very huge risk.

How many people would want to buy Chinese government bonds?

And that's why in the traditional sense, China cannot allow itself to run a trade deficit because if it does that, then the demand for its local currency is going to shrink over time.

Well, if the United States is running a trade deficit, then it's fine because on the other side, everybody will keep buying American investments, which is going to make America wealthier and richer.

Every time a country is buying a US investment, it is spending money in the United States, it is spending money on the US plants, it is spending money in the US market, which keeps growing the US market.

Which is why the US government bonds is the largest market in the world, the US stock market is the largest stock market in the world, and nowhere you can find so many mortgage-backed securities sold to foreign investors as much as it's in the United States.

Now let me give you an example of how it works.

Let's say we have a country called Japan and Japan want to sell cars.

Now if Japan will sell its cars to China, there is a 15% tariff.

Because China does not produce as great cars as Japan, and that's why if there is no tariff, the Chinese manufacturers cannot compete with the Japanese manufacturers and Japan will take over the entire market in Japan.

Which is why China is forced to impose a 15% tariff to give its local manufacturers an advantage.

But, what if Japan wants to sell its cars to the United States?

Well, before Trump, the tariffs on cars were around 2.5%.

Japan will certainly sell its Toyotas to the United States.

First of all, consumers in the US will enjoy far lower prices than people in China because in China, they will have to pay an extra 15% tax to buy that car.

Secondly, now Japan sold this car to the United States and it got its dollars.

What do you think Japan is going to do with all the dollars that it has acquired?

It will take them and will buy US government bonds, it will invest in the US stock market, and will also buy mortgage-backed securities in the United States.

So even though that Japan profited by selling into the United States, they took that money and brought it back to the United States and invested in the United States market, which grows the US market, which grows the US economy, which provides more jobs in the United States and keeps the US economy as the world's largest economy.

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