Even if that’s true, the problem with fiat as reserve is that it basically acts as a curse on the country who shoulders that burden. Besides America, no other c

Even if that’s true, the problem with fiat as reserve is that it basically acts as a curse on the country who shoulders that burden. Besides America, no other country is willing to step up to the plate. Reserve status results in an artificially high bid on exchange rates, which decimates the export industries of the host country and results in perpetual trade deficits. The US is in a relatively unique position by being a big enough economy to absorb this impact, and by having an advanced enough financial system to sustain perpetual trade deficits by converting low yield liabilities to high yield assets. But if for some reason or another the dollar loses reserve status, expect the central bank of any other contender to fight tooth and nail to protect their exchange rates. Just witness how the Swiss National Bank defended an arbitrary ceiling when global markets started piling en masse to the franc after the GFC. Or look at how China continuously manipulates a cheap yuan to keep exports competitive and its manufacturing based economy humming. Without the dollar, the only long term sustainable fiat reserve I can imagine is something like the IMF SDRs. Basically the major currencies creating a basket weighted blend to make sure no single economy is burdened with reserve status.