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SEC. 3. SAVING TAXPAYERS FUNDS BY TRANSITIONING TO THE USE OF $1 COINS. (a) In General- It is the policy of the United States that after $1 coins achieve sufficient market penetration such that consumers and retailers are comfortable using $1 coins and are able to obtain adequate supplies of $1 coins, $1 coins should replace $1 Federal Reserve notes as the only $1 monetary unit issued and circulated by the Federal Reserve System.

(f) No Effect on Legal Tender- Notwithstanding any other subsection of this section, $1 Federal Reserve notes are legal tender in the United States for all debts, public and private, public charges, taxes, and duties, regardless of the date of printing or issue.

Bloomberg's dready summary of the US economy is generally spot on, and is to be expected when any nation finally leaves, voluntarily or otherwise, the stranglehold of a global reserve currency. What Bloomberg failed to account for is what happens to the remainder of the Petrodollar world. Here is what we said last time: Outside from the domestic economic impact within EMs due to the downward oil price shock, we believe that the implications for financial market liquidity via the reduced recycling of petrodollars should not be underestimated. Because energy exporters do not fully invest their export receipts and effectively ‘save’ a considerable portion of their income, these surplus funds find their way back into bank deposits (fuelling the loan market) as well as into financial markets and other assets. This capital has helped fund debt among importers, helping to boost overall growth as well as other financial markets liquidity conditions. ... [T]his year, we expect that incremental liquidity typically provided by such recycled flows will be markedly reduced, estimating that direct and other capital outflows from energy exporters will have declined by USD253bn YoY. Of course, these economies also receive inward capital, so on a net basis, the additional capital provided externally is much lower. This year, we expect that net capital flows will be negative for EM, representing the first net inflow of capital (USD8bn) for the first time in eighteen years. This compares with USD60bn last year, which itself was down from USD248bn in 2012. At its peak, recycled EM petro dollars amounted to USD511bn back in 2006. The declines seen since 2006 not only reflect the changed global environment, but also the propensity of underlying exporters to begin investing the money domestically rather than save. The implications for financial markets liquidity - not to mention related downward pressure on US Treasury yields – is negative.

Considering the wildly violent moves we have seen so far in the market confirming just how little liquidity is left in the market, and of course, the absolutely collapse in Treasury yields, with the 30 Year just hitting a record low, this prediction has been borne out precisely as expected. And now, we await to see which other country will follow Russia out of the Petrodollar next, and what impact that will have not only on the world's reserve currency, on US Treasury rates, and on the most financialized commodity as this chart demonstrates...

... but on what is most important to developed world central planners everywhere: asset prices levels, and specifically what happens when the sellers emerge into what is rapidly shaping up as the most illiquid market in history.

While Russia likely envisioned abandoning its dollars under far better circumstances, the news is just as worrying for the United States and its dollar hegemony. Along with Russia, energy exporters worldwide are pulling their petrodollars out of world financial markets and other USD-denominated assets in favor of greater, and certainly necessary, spending domestically. In the past, these dollars have given life to the loan market and helped fund debt among energy importers, contributing to overall growth.

Petrodollar exports – otherwise known as petrodollar recycling – were negative in 2014 for the first time in nearly two decades. The result is falling global market liquidity, record low US Treasury rates, and higher borrowing costs for everyone – a tough pill to swallow for energy producers if oil prices remain low. The US dollar remains the global reserve currency for now, but the fact remains that nations are increasingly transacting on their own terms, and often times without the USD.

Under the so-called Sovereign Money proposal, the country’s central bank would become the only creator of money. “Crucially, the power to create money is kept separate from the power to decide how that new money is used,” Mr Sigurjonsson wrote in the proposal. “As with the state budget, the parliament will debate the government’s proposal for allocation of new money,” he wrote. Banks would continue to manage accounts and payments, and would serve as intermediaries between savers and lenders. Mr Sigurjonsson, a businessman and economist, was one of the masterminds behind Iceland’s household debt relief programme launched in May 2014 and aimed at helping the many Icelanders whose finances were strangled by inflation-indexed mortgages signed before the 2008 financial crisis.

 Guerra also acknowledged bluntly on the witness stand that he had lied in telling Chevron's team that attorneys for the Ecuadoreans offered him $300,000.     "Yes, sir, I lied there," Guerra told Eric Bloom, who represents Ecuador for the firm Winston & Strawn. "I wasn't truthful."     Guerra maintains that other attorneys for the Ecuadoreans, specifically Steven Donziger and Pablo Fajardo, offered money in return for ghostwriting the judgment on behalf of Judge Nicolas Zambrano, the final jurist to preside over the case.     Shifting the details of this supposed arrangement, though, Guerra walked back his allegation that Zambrano offered him 20 percent.     "That was my sworn statement in New York, but what I said is that, because of a circumstance, because of a situation, I mentioned 20 percent when it wasn't true, and I think that, as a gentleman, I should say the truth, and we did not discuss - I did not discuss 20 percent with Mr. Zambrano - but we did discuss that he would share with me from what he received," he said.     In his nearly 500-page ruling, Judge Kaplan pointed to bank records, daily planners, shipping records and airplane tickets as corroborating evidence that outweighed Guerra's credibility problems.

Particularly persuasive for Kaplan was evidence that Ecuador's national airline, Tame, certified delivery of packages between Guerra and Zambrano.     Guerra told the arbitrators this spring, however, that all 11 of these packages "had nothing to do with the [Chevron] case."     As for his plane tickets to the rainforest from Aug. 11 and 12, 2010, Guerra said they occurred during an irrelevant time period.     "If I traveled during those dates, it wasn't for me to provide assistance to the Chevron case," he said.     Guerra testified that Chevron representatives told him that they would have raised his pay if he could provide them with the key physical evidence they were looking for: a draft of the judgment.     "We were unable to find the main document," Guerra recalled them saying. "Had we been able to find it, we would have been able to offer you a larger amount, something like that, we have $18,000 for you, and we're going to take the computer with us."     Though Guerra did not have a copy of the judgment, Ecuador's forensic expert Christopher Racich testified that he found a running draft of the judgment against Chevron on Zambrano's hard drives.

Ecuador now argues that this forensic evidence - which Courthouse News reported exclusively early this year - proves Zambrano painstakingly wrote the ruling and saved it hundreds of times throughout the case.     Chevron has not been able to produce emails between Guerra, Zambrano and the purported ghostwriters, Donziger and Fajardo, Ecuador's forensic expert says.     Guerra acknowledged to the arbitrators that that the bounty of physical evidence he promised Chevron fell short.     There are no calendars and day planners marked with meetings scheduled between Fajardo, Donziger or Guerra, he acknowledged.     While Guerra said he had payments from Zambrano from April 2011 and February 2012, he testified that these "had no connection to the Chevron case."     For Chevron, the thousands of pages of transcripts show that the company "proved its case before the International Arbitration Tribunal."     "Witness and expert testimony confirmed that the Ecuadorean judgment against Chevron was ghostwritten by Steven Donziger and his team and that the Ecuadorian government is responsible for any further remediation," Chevron spokesman Morgan Crinklaw said in a statement. "Chevron also proved that Ecuador breached the U.S.-Ecuador Bilateral Investment Treaty and international law."     Donziger, who still works for the Ecuadorean villagers seeking to collect from Chevron, said in a statement that Guerra's latest testimony "demonstrates once and for all that Chevron's so-called racketeering case has completely fallen apart."

  "Guerra has been the linchpin of Chevron's entire body of trumped up evidence and he now stands not only as an admitted liar, but also as a shocking symbol of how Chevron's management has become so obsessed with evading its legal obligations in Ecuador that it is willing to risk presenting false evidence in court to try to frame adversary counsel and undermine the rule of law," Donziger added.