3 ms·
The US is engaged in a modern version of Mutually Assured Destruction (MAD) game theory using using national debt backed in USD instead of nuclear weapons. Any
by el_don_almighty 6y ago
The US is engaged in a modern version of Mutually Assured Destruction (MAD) game theory using using national debt backed in USD instead of nuclear weapons. Any strategic move against the dollar by another currency endangers the value of the country's economy because they hold so much US debt. Try to screw with the US and you will be destroyed faster because of the way debt markets work
Can China move their Yuan into a premier position by lowering the dollar? NO WAY. The minute their US denominated debt value reduces, their economy goes bust
In the end, as long as the US has the most distributed debt, the biggest bombs, and the most aircraft carriers, the dollar stands supreme and will even survive the marginalization of petrol.
- rossdavidh 6y ago"If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem." - J. Paul Getty In this situation, China would be the bank? Not, I should add, a long-term stable situation; sooner or later the bank will have a liquidity problem, and then you have a problem when you need more cash. But it probably does keep the U.S. and China from rushing as headlong into enmity.