The freezing of Russia’s (and Iran’s, Venezuela’s, Afghanistan’s) assets will have severe consequences for the U.S. dollar. The U.S. essentially defaulted by holding back Russian assets that it had the fiduciary duty to give back. China and everyone else will move its reserves to countries or into commodities that are not under U.S. control. See the Michael Hudson’s interviews here and here:

[T]hat means that other countries all of a sudden see what they thought was their flight to security, what they thought was their most secure savings, their holdings in U.S. banks, US treasury bill, all of a sudden, is holding them hostage and is a high risk. Even the Financial Times of London has been writing about this, saying, how can the United States that was getting a free ride off the dollar standard for the last 50 years, ever since 1971, when foreign countries held dollars instead of gold and basically holding dollars means you buy U.S. Treasury bonds to finance the US budget deficit and the balance of payments deficit. How can the United States kill the goose that’s giving it the free ride? Well, the answer is that other countries can only move into gold and there’s an alternative to the dollar because that’s something that all the countries of the world have agreed upon is an asset, not a liability. If you hold any foreign currency, that currency is a liability of a foreign country, and if you hold gold, it’s a pure asset.

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