4 ms·

Complain about US exceptionalism as you wish... but about 84% of the over 5 trillion daily FX market volume is USD trades. Why? Because literally no other marke

by rrggrr 8y ago

Complain about US exceptionalism as you wish... but about 84% of the over 5 trillion daily FX market volume is USD trades. Why? Because literally no other market (country) has the liquidity, transparency, stability, and asset base carry this level of risk (or trust).

mrguyorama 8y ago
Isn't this really just a first mover advantage though? After world war 2, the US was really the only country still in the position to advance rather than just rebuild. Combine that with the fact that we helped fund a lot of rebuilding with the USD. The United States has really lucked out in a lot of ways
- rrggrr 8y ago
  No. The US legal system, a free press, a long-standing calvinist work ethic, its asset base and continued financial infrastructure investment are much more than luck. These things have proven impossible to reproduce - in aggregate - anywhere else.
  - cheez 8y ago
    Correct. I am not a US citizen and a majority of my assets are USD denominated primarily because I believe in the system of government, recent obstructionism is part of it. Basically, stay out of the people's way and provide recourse. Decent job so far. Not perfect, but better than any other place I've had direct experience with.
  - loceng 8y ago
    Will be interesting to see how this changes if the Trump-Russia shenanigans is successful, or not if security services, rank and order have a handle on it. Edit: A downvote? It won't be interesting? Go away shallow negativity.. Edit: -4 points. Hello darkness, my old friend..
    - deleted 8y ago
      [deleted]
    - emodendroket 8y ago
      The supposed influence of Putin is really poorly manifested in US policy, which remains as hostile as ever (Mattis is going around talking about the need to prepare for military conflict with Russia and China, for Heaven's sake).
      - loceng 8y ago
        The issue stems from the constitution - and perhaps general understanding and present moment psyche of what an act of war constitutes or looks like - didn't have the foresight of understanding cyber/information warfare at the efficiencies and relative cost the internet provides. It would have been great to foresee and design to counter what Facebook's structure exposed and allowed bad actors to take advantage of; it's not surprising however as Mark Zuckerberg. not understanding why the Harvard version of Facebook being developed was taking so long, thought he could do it faster: because they were actually working through privacy, security concerns, and such - whereas Mark's level of care was "break things fast" in comparison. Enough of us have hopefully learned our lesson to swing back the yin-yang cycle and to manage and counterbalance the allowance a system like Facebook created, to prevent these overly efficient systems in spreading lies, propaganda so easily - without easing into censorship and the pitfalls inherent to silencing anyone.
        emodendroket 8y ago
        I'm not sure how this response is intended to be related to mine.
        loceng 8y ago
        Re: "The supposed influence of Putin is really poorly manifested in US policy, which remains as hostile as ever (Mattis is going around talking about the need to prepare for military conflict with Russia and China, for Heaven's sake)." I understood your comment as you either believing or not believing, doubting, that Putin and their methods aren't manifested/taken into account/written into US policy to counteract said influence? I wasn't sure if you thought it was trivial that Mattis is wanting to prepare for possible conflict with Russia and China. I expanded my comment to include Facebook and other social media as a means to manipulating a population in what hope to be democratic elections.
  - cm2187 8y ago
    I think it is mostly inertia. The EUR probably has all the qualities required to be used where USD is used. But conventions and traditions die hard. For FX trading for instance, if you start quoting products against EUR instead of USD, you split the market, reduce liquidity, etc. For planes, I have absolutely no idea why a european manufacturer would sell a european made plane to a european airline in USD...
    - dahdum 8y ago
      I'd guess that much of their supply chain is in USD and that the manufacturer would prefer not to be ones hedging the majority of the currency risk (at their expense).
    - elliottlocke 8y ago
      The EUR isn't proven enough to overtake the USD. The eurozone is just now exiting a deep recession that exposed the weakness of its structure. Until the eurozone countries adopt a more coherent monetary and fiscal union, crises like Greece will still be a risk (this is before we get into the level of bailing out German banks for betting on Greece). Remedy this, and the EUR will become a serious threat to the USD.
    - JumpCrisscross 8y ago
      > EUR probably has all the qualities required to be used where USD is used The U.S. doesn’t have perennial debates about breaking up or bits breaking off. If your Euro bank deposits are at risk of suddenly turning into drachma or lira, that’s a problem.
      - checkyoursudo 8y ago
        Never been to Texas, eh? Hell, the break-California-up initiative made it to the ballot this year, was removed for this year by the CA Sup Ct, and has a non-zero chance of being back on in 2020. E.g., https://ballotpedia.org/California_Proposition_9,_Three_States_Initiative_(2018) https://ballotpedia.org/California_Proposition_9,_Three_Stat... One of the questions I was asked in a State Attorney General Office interview in 2009 was: "What state would you kick out of the union and why?" (The secession debates were raging in certain circles after Obama was elected, and I guess some AGs wanted to know if incoming lawyers were inclined that way?) Will Texas ever secede? Will CA ever actually break up? I have no idea, and I doubt it. But the debate and even the effort is there.
  - XorNot 8y ago
    Actually you just didn't have most of your infrastructure destroyed across the span of civilization's first two large-scale industrial wars and are the beneficiaries of controlling a temperate-climate block of latitude with access to both major oceans and no nearby similarly industrialized neighbors in the span of time those wars happened.
    - arcbyte 8y ago
      Not most, true; only half of it in the Civil War.
    - irrational 8y ago
      How did Germany end up with the most robust economy in Europe when it seems like it should have the worst economy since it isn't located in a temperate-climate, it was divided in half for decades and had to reabsorb the poor Eastern half, was destroyed twice, underwent sanctions, etc.? Somehow Germany overcame everything (most of which it brought upon itself of course). Why couldn't France, Italy, Greece, Spain, etc. replicate Germany's success?
      - panarky 8y ago
        https://en.wikipedia.org/wiki/Marshall_Plan https://en.wikipedia.org/wiki/Marshall_Plan https://en.wikipedia.org/wiki/Occupation_of_Japan https://en.wikipedia.org/wiki/Occupation_of_Japan
      - danielvf 8y ago
        Since I can't reply directly to the Marshal plan comments: The Marshal Plan gave much less money to Germany than to anyone else, per capita. Greece received, per capita, about 3 times what Germany got. The UK, with a smaller population than Germany, received 3,297 million, while a larger Germany got 1,448 million.
        kazen44 8y ago
        Also, European economic integration and cooperation should not be understated and it's effect on rebuilding germany. Especially in the early days of the EEC/ECSC, rebuilding (west) germany was important for many other european nations at the time to increase their export markets. (Benelux especially).
  - howard941 8y ago
    These were hard won and hard to keep. I fear that they'll be lost within my (X) generation.
  - emodendroket 8y ago
    Yeah OK but World War II and its rich natural resources might have had something to do with it.
  - jorvi 8y ago
    > No. Yes. > The US legal system The US legal system is not some global shining paragon of how a judicial system should operate. See the shitshow around Kavanaugh how the highest court of the US judicial system has become a plaything of partisan politics. Remember that for a proper trias politica, there needs to be clear separation between the two. > a free press America is 45th in Freedom of Press rankings, behind Burkina Faso, a country that was a dictatorship until 2014, under military control until 2015, and still somewhat in turmoil. > a long-standing calvinist work ethic Most of NW Europe has 'a long-standing calvinist work ethic'. > continued financial infrastructure investment It is not as if the rest of the worlds' financial infrastructure is in disrepair. The reason why the US has such a huge finance industry isn't 'continued upkeep' but the absurd freedom the financial industry gets to do whatever it wants. The strange thing is that the US doesn't even have the most lax regulations - they just have absurdly weak enforcement of those regulations. For a prime example look up how absurdly lightly HSBC got away with their criminal behaviour. > These things have proven impossible to reproduce - in aggregate - anywhere else. There are two reasons for the US dollar being the main reserve currency: WWII and the petro dollar. Your claim is pretty much a perfect example of American Exceptionalism. 'American exceptionalism is an ideology holding the United States as unique among nations in positive or negative connotations, with respect to its ideas of democracy and personal freedom'
  - panarky 8y ago
    With apologies to Winston Churchill ... Many forms of money have been tried, and will be tried in this world of sin and woe. No one pretends that the US dollar is perfect. Indeed it has been said that the US dollar is the worst form of money except for all those other forms that have been tried from time to time.
- georgeecollins 8y ago
  From what little experience I have with working with companies in other countries it does seem like the US is really different than many other developed countries. It is relatively easy to enforce contracts in the US. Public companies are very transparent. There is a low level of corruption. Rules about moving money around, investing, and taxes are relatively simple. Hiring people (particularly in any variety of skills) and letting people go when you need to is possible. Lots of other countries have great economies and different advantages over the US. But that the set of advantages above isn't more widely replicated points to more than just first mover advantage.
  - emodendroket 8y ago
    Certainly there are many countries that do worse on those metrics. But there are others which are comparable or better. Then again, those countries do not have the world's largest military apparatus spanning the globe.
deleted 8y ago
[deleted]

by rrggrr 8y ago

mrguyorama 8y ago

Isn't this really just a first mover advantage though? After world war 2, the US was really the only country still in the position to advance rather than just rebuild. Combine that with the fact that we helped fund a lot of rebuilding with the USD. The United States has really lucked out in a lot of ways

rrggrr 8y ago
No. The US legal system, a free press, a long-standing calvinist work ethic, its asset base and continued financial infrastructure investment are much more than luck. These things have proven impossible to reproduce - in aggregate - anywhere else.
- cheez 8y ago
  Correct. I am not a US citizen and a majority of my assets are USD denominated primarily because I believe in the system of government, recent obstructionism is part of it. Basically, stay out of the people's way and provide recourse. Decent job so far. Not perfect, but better than any other place I've had direct experience with.
- loceng 8y ago
  Will be interesting to see how this changes if the Trump-Russia shenanigans is successful, or not if security services, rank and order have a handle on it. Edit: A downvote? It won't be interesting? Go away shallow negativity.. Edit: -4 points. Hello darkness, my old friend..
  - deleted 8y ago
    [deleted]
  - emodendroket 8y ago
    The supposed influence of Putin is really poorly manifested in US policy, which remains as hostile as ever (Mattis is going around talking about the need to prepare for military conflict with Russia and China, for Heaven's sake).
    - loceng 8y ago
      The issue stems from the constitution - and perhaps general understanding and present moment psyche of what an act of war constitutes or looks like - didn't have the foresight of understanding cyber/information warfare at the efficiencies and relative cost the internet provides. It would have been great to foresee and design to counter what Facebook's structure exposed and allowed bad actors to take advantage of; it's not surprising however as Mark Zuckerberg. not understanding why the Harvard version of Facebook being developed was taking so long, thought he could do it faster: because they were actually working through privacy, security concerns, and such - whereas Mark's level of care was "break things fast" in comparison. Enough of us have hopefully learned our lesson to swing back the yin-yang cycle and to manage and counterbalance the allowance a system like Facebook created, to prevent these overly efficient systems in spreading lies, propaganda so easily - without easing into censorship and the pitfalls inherent to silencing anyone.
      - emodendroket 8y ago
        I'm not sure how this response is intended to be related to mine.
        loceng 8y ago
        Re: "The supposed influence of Putin is really poorly manifested in US policy, which remains as hostile as ever (Mattis is going around talking about the need to prepare for military conflict with Russia and China, for Heaven's sake)." I understood your comment as you either believing or not believing, doubting, that Putin and their methods aren't manifested/taken into account/written into US policy to counteract said influence? I wasn't sure if you thought it was trivial that Mattis is wanting to prepare for possible conflict with Russia and China. I expanded my comment to include Facebook and other social media as a means to manipulating a population in what hope to be democratic elections.
- cm2187 8y ago
  I think it is mostly inertia. The EUR probably has all the qualities required to be used where USD is used. But conventions and traditions die hard. For FX trading for instance, if you start quoting products against EUR instead of USD, you split the market, reduce liquidity, etc. For planes, I have absolutely no idea why a european manufacturer would sell a european made plane to a european airline in USD...
  - dahdum 8y ago
    I'd guess that much of their supply chain is in USD and that the manufacturer would prefer not to be ones hedging the majority of the currency risk (at their expense).
  - elliottlocke 8y ago
    The EUR isn't proven enough to overtake the USD. The eurozone is just now exiting a deep recession that exposed the weakness of its structure. Until the eurozone countries adopt a more coherent monetary and fiscal union, crises like Greece will still be a risk (this is before we get into the level of bailing out German banks for betting on Greece). Remedy this, and the EUR will become a serious threat to the USD.
  - JumpCrisscross 8y ago
    > EUR probably has all the qualities required to be used where USD is used The U.S. doesn’t have perennial debates about breaking up or bits breaking off. If your Euro bank deposits are at risk of suddenly turning into drachma or lira, that’s a problem.
    - checkyoursudo 8y ago
      Never been to Texas, eh? Hell, the break-California-up initiative made it to the ballot this year, was removed for this year by the CA Sup Ct, and has a non-zero chance of being back on in 2020. E.g., https://ballotpedia.org/California_Proposition_9,_Three_States_Initiative_(2018) https://ballotpedia.org/California_Proposition_9,_Three_Stat... One of the questions I was asked in a State Attorney General Office interview in 2009 was: "What state would you kick out of the union and why?" (The secession debates were raging in certain circles after Obama was elected, and I guess some AGs wanted to know if incoming lawyers were inclined that way?) Will Texas ever secede? Will CA ever actually break up? I have no idea, and I doubt it. But the debate and even the effort is there.
- XorNot 8y ago
  Actually you just didn't have most of your infrastructure destroyed across the span of civilization's first two large-scale industrial wars and are the beneficiaries of controlling a temperate-climate block of latitude with access to both major oceans and no nearby similarly industrialized neighbors in the span of time those wars happened.
  - arcbyte 8y ago
    Not most, true; only half of it in the Civil War.
  - irrational 8y ago
    How did Germany end up with the most robust economy in Europe when it seems like it should have the worst economy since it isn't located in a temperate-climate, it was divided in half for decades and had to reabsorb the poor Eastern half, was destroyed twice, underwent sanctions, etc.? Somehow Germany overcame everything (most of which it brought upon itself of course). Why couldn't France, Italy, Greece, Spain, etc. replicate Germany's success?
    - panarky 8y ago
      https://en.wikipedia.org/wiki/Marshall_Plan https://en.wikipedia.org/wiki/Marshall_Plan https://en.wikipedia.org/wiki/Occupation_of_Japan https://en.wikipedia.org/wiki/Occupation_of_Japan
    - danielvf 8y ago
      Since I can't reply directly to the Marshal plan comments: The Marshal Plan gave much less money to Germany than to anyone else, per capita. Greece received, per capita, about 3 times what Germany got. The UK, with a smaller population than Germany, received 3,297 million, while a larger Germany got 1,448 million.
      - kazen44 8y ago
        Also, European economic integration and cooperation should not be understated and it's effect on rebuilding germany. Especially in the early days of the EEC/ECSC, rebuilding (west) germany was important for many other european nations at the time to increase their export markets. (Benelux especially).
- howard941 8y ago
  These were hard won and hard to keep. I fear that they'll be lost within my (X) generation.
- emodendroket 8y ago
  Yeah OK but World War II and its rich natural resources might have had something to do with it.
- jorvi 8y ago
  > No. Yes. > The US legal system The US legal system is not some global shining paragon of how a judicial system should operate. See the shitshow around Kavanaugh how the highest court of the US judicial system has become a plaything of partisan politics. Remember that for a proper trias politica, there needs to be clear separation between the two. > a free press America is 45th in Freedom of Press rankings, behind Burkina Faso, a country that was a dictatorship until 2014, under military control until 2015, and still somewhat in turmoil. > a long-standing calvinist work ethic Most of NW Europe has 'a long-standing calvinist work ethic'. > continued financial infrastructure investment It is not as if the rest of the worlds' financial infrastructure is in disrepair. The reason why the US has such a huge finance industry isn't 'continued upkeep' but the absurd freedom the financial industry gets to do whatever it wants. The strange thing is that the US doesn't even have the most lax regulations - they just have absurdly weak enforcement of those regulations. For a prime example look up how absurdly lightly HSBC got away with their criminal behaviour. > These things have proven impossible to reproduce - in aggregate - anywhere else. There are two reasons for the US dollar being the main reserve currency: WWII and the petro dollar. Your claim is pretty much a perfect example of American Exceptionalism. 'American exceptionalism is an ideology holding the United States as unique among nations in positive or negative connotations, with respect to its ideas of democracy and personal freedom'
- panarky 8y ago
  With apologies to Winston Churchill ... Many forms of money have been tried, and will be tried in this world of sin and woe. No one pretends that the US dollar is perfect. Indeed it has been said that the US dollar is the worst form of money except for all those other forms that have been tried from time to time.
georgeecollins 8y ago
From what little experience I have with working with companies in other countries it does seem like the US is really different than many other developed countries. It is relatively easy to enforce contracts in the US. Public companies are very transparent. There is a low level of corruption. Rules about moving money around, investing, and taxes are relatively simple. Hiring people (particularly in any variety of skills) and letting people go when you need to is possible. Lots of other countries have great economies and different advantages over the US. But that the set of advantages above isn't more widely replicated points to more than just first mover advantage.
- emodendroket 8y ago
  Certainly there are many countries that do worse on those metrics. But there are others which are comparable or better. Then again, those countries do not have the world's largest military apparatus spanning the globe.

deleted 8y ago

[deleted]