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The United States has a substantial advantage in that the dollar is considered the world's reserve currency. This is in large part due to the "petrodollar" as t
by appstateguy 7y ago
The United States has a substantial advantage in that the dollar is considered the world's reserve currency. This is in large part due to the "petrodollar" as the vast majority of oil is only sold in dollars. This puts a large demand on US Treasuries from foreign countries & banks so that they can meet this dollar demand.
The dollar's dominance is slowly weening as Iran now sells oil to China using the Yuan. The IMF also has a potential replacement reserve "currency" called Special Drawing Rights (SDR). Though it's not technically a currency but instead it's more an index based on basket of currencies. That basket includes US Dollars, Japanese Yen, the Euro, Pound Sterling, and most recently the Chinese Yuan.
- toomuchtodo 7y agoSDR sounds like Facebook’s Libra without them blockchain nonsense.
- c0restraint 7y agoHow do you draw that conclusion?
- toomuchtodo 7y agoBasket of currencies without a blockchain or digital ledger component. Although the Libra Wikipedia page indicates that idea has been deprecated: > As of January of 2020, Libra is said to have dropped the idea of a mixed currency basket in favor of individual stablecoins pegged to individual currencies.
- TheOperator 7y agoThis St Louis Fed article says the US made more money from Seigniorage when inflation levels were moderate than when they were low. So this is perhaps a thin pretense for a never-ending debt bubble. https://files.stlouisfed.org/files/htdocs/publications/review/92/03/Seigniorage_Mar_Apr1992.pdf&sa=U&ved=2ahUKEwiRvYfk4afnAhWJu54KHZa2AmQQFjAKegQICRAB&usg=AOvVaw3RtJhfKzrTOIAP9cPiZ6oU https://files.stlouisfed.org/files/htdocs/publications/revie...