The only reason this isn't yet glaringly obvious to everyone, is that the Euro and GBP are also stuck on a downward trend.
Speculatively, I believe the Euro and GBP will 'save' themselves out of trouble within the next 5-7 years, whereas the US will practically have to reinvent the earnings foundation of it's entire economy before it can break out of this current downward spiral of excessive debt.
I believe the US dollar is in a long term downward trend because it is slowly slowly losing its reserve currency status as the US is losing its economic predominance. That's not a bad thing. It's just a reflection of Asia becoming less bad economically, which is neither difficult nor surprising considering how bad they used to be.
The US used to be the biggest user of commodities, so it was pretty logical that the dollar should be the currency in which commodities are priced. Today China is the biggest user of commodities and it is only logical that countries like Brazil are going to take a little more RMB in exchange for their iron ore than they used to. And considering they import a lot of stuff from China as well, why should they sell their RMB for USD immediately? They won't.
Exchange rates are not based on absolutes but on relative strength. So the question is not wether the USD will or will not lose its reserve currency status. The question is how fast. My totally scientific characterization of that pace was "slowly slowly".
So, let us take your simplified example and expand it a little to see a broader macroeconomic picture that illustrates why Brazil and China would want to do that trade in dollars. Let's say that Brazil wants to use the cash from that commodity sale to improve the living conditions of their citizens and purchase some Catepillar brand forest-clearing bulldozers and some crude oil to refine into gasoline for those bulldozers because their local sugar-cane ethanol would wear-out the engines too quickly. Well, Catepillar is a American company so it makes sense for them to bill Brazil in USD instead RMB. The middle east oil exporter also charges Brazil in USD because the US Navy protects their shipping lanes and the CIA and State Dept maintains (or doesn't) the internal stability of that country. Last, China has USD coming out of its ears and is more than happy to trade pieces of paper for real assets like Brazillian ore.
Now, why would the Chinese want Brazil to pay them in USD for some Chinese goods? The Chinese are smart and recognize that if the USD sank too far in value that the manufacturing jobs in China would return to the USA. This is a problem for the Communists because they do not have a sufficient internal economy to continue employing hundreds of millions of peasants. And, that would be a dangerous political problem for the Communist leadership in China.
Now, I will agree that this assumes linear development, but it would take a situation like WWII to knock the USA out of reserve currency status, and I don't think that is very likely.
In conclusion, welcome to Pax Americana; you should learn to love it.
What I'm saying is that over the coming decades, the importance of the US is declining in relative terms and that trend is affecting the reserve currency status of the USD. Countries are diversifying out of the dollar. It makes sense for China and Brazil to hold some of their foreign currency reserves in each others currency instead of dollars, now that they are such close trading partners.
What you describe is the status quo. What matters is the trend and the rate of change.
1) The USA's economy is "financialized" to a much greater extent than Europe's.
2) Lots of "phantom" GDP in USA which makes US "productivity" and per-capita GDP look higher than corresponding Europe figures (it's not an "apples to apples comparison"), thereby hiding US economy's weaknesses (e.g., high college tuition costs, health insurance costs, high healthcare costs (paid out by insurance companies to hospitals), doctor liability insurance etc all inflate the GDP but the corresponding figures for Europe are smaller).
1. "Credit Suisse: America Is Not Broke" (http://pragcap.com/credit-suisse-america-is-not-broke)
2. "Understanding The Modern Monetary System" (http://pragcap.com/resources/understanding-modern-monetary-s...).
"Government deficit spending and tax collection should be maintained at a rate that does not impose financial hardship on the private sector. Because the Federal government is not a state or household it should not manage its balance sheet for its own benefit. Rather, taxes and government spending should be managed in a way that most benefits the private sector and encourages private sector prosperity."
"The key takeaway here is that the government balance sheet is not like a household or a state. It does not finance spending via revenues or debt issuance. The US government, as a monopoly supplier of currency in a floating exchange rate system never really has nor doesn’t have money."