Russian Publication suggests alternative to the IMF is moving forward

Here we have an article that speaks directly to what we have been following here. Namely that the BRIC nations will continue to move forward to bypass the IMF and the US dollar since progress within the IMF appears to be stalled.

It seems likely that this will continue no matter what the IMF does because trust does not really exist that the IMF will be reformed in a way that would satisfy the BRIC nations. This way they are moving forward on their own Plan B regardless. And they can certainly use this competitive structure to pressure the US and IMF. 

If this continues and ramps up, the US and IMF response will be of interest here. Will they just allow all this to take place or will the US start to try and respond in some way? Note the 2015 date in the article. The BRICs gave the IMF/US til the end of this year to pass the reforms.

This article also confirms that all this could lead to dropping the US dollar (and possibly soon if things break down further) and using other currencies. Gold backing for those currencies would not be surprising either given the massive gold buying taking place in Russia and China (and other Eastern nations).

Here some quotes from the article:

"Very soon, the IMF will cease to be the world's only organization capable of rendering international financial assistance. The BRICS countries are setting up alternative institutions, including a currency reserve pool and a development bank."

"The BRICS countries (Brazil, Russia, India, China and South Africa) have made significant progress in setting up structures that would serve as an alternative to the International Monetary Fund and the World Bank, which are dominated by the U.S. and the EU. A currency reserve pool, as a replacement for the IMF, and a BRICS development bank, as a replacement for the World Bank, will begin operating as soon as in 2015, Russian Ambassador at Large Vadim Lukov has said."

"In addition, the BRICS countries have already agreed on the amount of authorized capital for the new institutions: $100 billion each. "Talks are under way on the distribution of the initial capital of $50 billion between the partners and on the location for the headquarters of the bank. Each of the BRICS countries has expressed a considerable interest in having the headquarters on its territory," Lukov said.

Source: Russia Beyond the Headlines -http://rbth.com/business/2014/04/14/brics_countries_to_set_up_their_own_imf_35891.html)Source: Russia Beyond the Headlines -http://rbth.com/business/2014/04/14/brics_countries_to_set_up_their_own_imf_35891.html)

"The currency reserve pool will also help the BRICS countries to gradually establish cooperation without the use of the dollar, points out Natalya Samoilova.This, however, will take time. For the time being, it has been decided to replenish the authorized capital of the Development Bank and the Currency Reserve Pool with U.S. dollars. Thus the U.S. currency system is getting an additional boost. However, it cannot be ruled out that very soon (given the threat of U.S. and EU economic sanctions against Russia) the dollar may be replaced by the ruble and other national currencies of the BRICS counties.

Source: Russia Beyond the Headlines -http://rbth.com/business/2014/04/14/brics_countries_to_set_up_their_own_imf_35891.html)Source: Russia Beyond the Headlines -http://rbth.com/business/2014/04/14/brics_countries_to_set_up_their_own_imf_35891.html)