Everything Joe Biden touches seems to fall apart.
Now he’s fiddling with how financial institutions complete financial transactions.
And it’s making American banks nervous for one important reason.
Joe Biden’s weak presidency has emboldened Putin to basically start WWIII.
Now Biden’s foreign policy fumbling has banks bracing for “a prolonged period of economic instability.”
According to American Banker the unprecedented sanctions against Russia could cause all kinds of trouble here in America.
“Already, those sanctions have targeted huge swaths of the Russian financial system, including the country’s central bank, its sovereign wealth fund and several of the nation’s largest private financial institutions,” Brendan Pedersen and Claire Williams wrote in an article for the industry trade news outlet. “The impact has been dramatic, with the value of the Russian currency falling to historic lows this week—an act of economic warfare never directed at a world power in modern history.”
Rather than take an aggressive approach like Donald Trump (who informed Vladimir Putin exactly what would happen if he tried any funny business under his watch), Biden made it abundantly obvious he doesn’t know how to handle any major crisis.
Now that Putin’s gone wild, Biden has finally gotten around to poking the bear.
The possibility of cyber-attacks from Russia—maybe even backed by intellectual capital from China—is a very real threat banks fear will only intensify in the coming days.
That potential has been heightened by the fact that the United States, United Kingdom, and the European Union have already decided to remove some Russian banks from the SWIFT banking system.
That’s a tool that helps banks rapidly transfer funds worldwide.
So far, some Russian banks are still being allowed to use the system so the United States can keep buying oil from Russia, but that may not last as Biden is under increasing pressure to put an embargo on oil.
Such a move would send oil prices nuclear – especially with the Biden administration still clinging to it’s “green” climate agenda that’s taking American energy independence off the table for decades to come if at all.
Until the Biden administration abandons it’s absurd green energy policies, the United States is effectively bankrolling Vladimir Putin’s effort to gain control of Ukraine, as no U.S. embargo would ultimately prevent all of Putin’s oil from making it onto the market.
Further, if Biden moves forward with oil embargos, it may result in retaliation via an all out cyber war.
There’s already evidence Russian cyber-attacks against US banks are increasing.
Bank executives—who refused to speak on the record—told the New York Post they spend billions of dollars each year defending themselves against cyber criminals.
Most of the attacks come from operatives in Russia, China, and Iran.
But since the sanctions against Russia were announced, there’s a new wave of attacks that’s different from what they’ve seen in the past.
They described what’s happening now as a “subtle but intensified assault on banks’ technological infrastructure.”
In February Banks in Ukraine were hit by a string of cyber attacks ahead of Putin’s invasion where users were unable to even access banks’ online systems.
Aside from cyber warfare, it also looks like the sanctions could solidify China’s aggressive coalition-building efforts in the region.
China has already created an alternative to SWIFT called the Chinese Cross-Border Interbank Payment System (CIPS).
They’ve been working with Russia and India to make their rapid transfer system—which only processes 0.3% of transactions of what SWIFT manages—become more widely used.
More than 11,000 financial systems use the SWIFT system which was created in 1977, where most transactions are settled using the United States’ dollar, which many say helps the United States play an outsized role in the international economy and gain preferential treatment.
That’s especially important since the United States’ debt now exceeds $30 trillion.
No matter what happens in Ukraine, China could end up the victor if it can use the current crisis to gain a foothold influencing international monetary policy.
China’s CIPS program has only 613 indirect international participating banks.
But if they can move transactions for essential products like Russia’s crude oil and petroleum product supplies over to their system, banks all over the world will be forced to play the game in a system China controls.
Political Animal News will keep you up-to-date on any new developments in this ongoing story.