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This is known as currency substitution or dollarization and can be done officially or unofficially. But what happens when the world's currency also inflates? h

• adventured 5y ago
  > But what happens when the world's currency also inflates? It's a relative premise of course. The USD Index [1][2] (currently over 97 and rising) indicates the USD isn't being debased at a faster rate than the other major currencies. The EU, China and Japan have debt & spending problems every bit as bad as the US (with the EU and Japan having far worse growth problems), choking at their economic and political systems persistently and requiring forever interest rate games. So if, this decade, Argentina's currency debases at 20% per year and the USD debases at 5% per year, and there are no superior alternatives in the currency realm (eg the other major currencies are doing something similar), you'll largely mentally disregard the USD inflation, as all the major boats are getting the same tide, and your USD choice is still the right one vs the local currency. And if you can, you may properly choose to diversify whenever possible into inflation hedging assets with surplus cash, trying to balance holding enough transactional USD vs inflation hedges to limit some of the USD damage. [1] https://finviz.com/futures_charts.ashx?p=d1&t=DX https://finviz.com/futures_charts.ashx?p=d1&t=DX [2] https://www.investopedia.com/terms/u/usdx.asp https://www.investopedia.com/terms/u/usdx.asp