4 ms·
The point of the article is that around the world very large amounts of loans have been denominated in US dollars, even in countries that don't use USD. That me
by dageshi 7y ago
The point of the article is that around the world very large amounts of loans have been denominated in US dollars, even in countries that don't use USD. That means there is always a constant and large demand for USD to repay those loans.
So outside of the US, no USD is not just a store of savings, it's a means of repaying debt. Hence why people want it and will accept it as a first preference over most other currencies when international transactions need to be made.
- neilwilson 7y agoRepaying debt is the same as an increase in the store of savings. Your personal balance sheet moves in the same direction from a lower value to a higher one.
- dageshi 7y agoNot in USD it doesn't. You got your loan in USD, spent it to buy whatever you needed, you have assets, not USD. You need USD to repay the loan, where do you get them from?