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Is that going to change anytime soon? Genuinely interested because all currencies, other than USD are depreciating.

PKop 4y ago
Unless Western leaders or US particularly, want a severe global recession to persist, I think they will eventually pursue whatever means necessary to weaken $ and help Europe, rest of world, perhaps with a new "Plaza Accord" type arrangement[0]. This is if one believes they actually care about stabilizing European industry and economy and not rather that they are keen on seeing global chaos for a period of time and a weaker Europe dependent on US instead of having close trade relations with Russia and a thriving domestic industrial sector (which they have with cheap Russian energy, which they don't with sanction and less supplied more expensive substitutes), in service to US's own relative position becoming stronger and maintenance of global hegemony. Many analysts, particularly leaders form China, have opined on the nature of US periodic "harvesting" through dollar strengthening policy which crushes developing (and now even developed) countries so as to maintain their reserve currency status and relative global strength (even conceding that in short term everyone experiences pain as result). Great speech from Qiao Liang, a Chinese PLA Major-General articulating the nature of the reserve $ and the way US uses it as financial weapon particularly when they strengthen it to temporarily crush world economy [1]. [0] https://en.wikipedia.org/wiki/Plaza_Accord https://en.wikipedia.org/wiki/Plaza_Accord [1] http://chinascope.org/archives/6458 http://chinascope.org/archives/6458 ^From link General Qio Lian quote: "Not many people had a clear understanding of this at the time. People, including economists and financial experts, didn’t realize that the most important thing in the 20th century was not World War I, World War II, or the disintegration of the USSR, but rather the August 15, 1971, disconnection between the U.S. dollar and gold." Precient insight into developing Ukraine crises, (speech made in 2015): "Where else did [US] target? Ukraine, the connection between the EU and Russia. Of course there were some problems under Ukraine President Yanukovych’s administration, but the reason that the Americans picked it was not simply because of his problem. They had three goals: teach a lesson to Yanukovych who didn’t listen to the U.S., prevent the EU from getting too close to Russia, and create a bad investment environment in Europe." ^In the context of recent financial sanctions against Russian trade and currency, this is exactly what is happening across Europe right now.
- rowanajmarshall 4y ago
  > whatever means necessary to weaken $ and help Europe, rest of world I might be misunderstanding something here, but wouldn't a weak dollar strengthen the US economy (in terms of exports) relative to other peer economies (e.g. Euro area, the UK, Japan)?
  - PKop 4y ago
    Yes and I think there are often conflicting interests around who gains and who loses even within the US from a strong or weak dollar. But this is why I noted that, every so often US for geopolitical reason seems willing to except even domestic pain for some period of time if the relative position of US increases due to the rest of world suffering more during strong-dollar periods. Give that article a read to understand what I'm saying regarding periodic "harvesting" of rest of world economy (for one, via financial flows into $ and assets as safe haven). Arguably Volcker's extreme tightening in 1970's, with his willingness to crush even the domestic economy for a time, was due to geopolitical interests to maintain trust in the $ as reserve currency and to crush USSR economy by destroying commodity prices and bankrupting their economy partially due to their inability to print the currency of which they had some external debts in. But I think this is a complex topic you can find many arguments both ways. And US policy has gone back at forth at times pursing both strong and weak for their own interest. Though I didn't mean to imply weak dollar wouldn't also boost US domestic economy. But to the thrust of my post which way US regime wants to go depends on current geopolitical context.
- reducesuffering 4y ago
  How is that last part prescient? That's a year after Euromaidan. Ever since then, 2014, critics have always lambasted any US/EU in support of the Ukrainian people. Why? Because geopolitically Ukraine was meant to be another Belarus, a patsy state, for Russia and its allies. That statement is the opposite of prescient, in that we now see the mask off and the devil that patsy Ukrainian governments were actually making a deal with.
  - PKop 4y ago
noir_lord 4y ago
USD is the global reserve currency - when shit goes sideways everyone jumps on the dollar and that pushes it's value up and the value of the other currencies down. In the case of the EU/Euro you've also got an active shooting war, massive inflation and the economic damage that the UK did both to itself and the EU and a bunch of other stuff.
fulafel 4y ago
Currency depreciation forecast from oecd: https://data.oecd.org/price/inflation-forecast.htm#indicator-chart https://data.oecd.org/price/inflation-forecast.htm#indicator...

PKop 4y ago

Unless Western leaders or US particularly, want a severe global recession to persist, I think they will eventually pursue whatever means necessary to weaken $ and help Europe, rest of world, perhaps with a new "Plaza Accord" type arrangement[0]. This is if one believes they actually care about stabilizing European industry and economy and not rather that they are keen on seeing global chaos for a period of time and a weaker Europe dependent on US instead of having close trade relations with Russia and a thriving domestic industrial sector (which they have with cheap Russian energy, which they don't with sanction and less supplied more expensive substitutes), in service to US's own relative position becoming stronger and maintenance of global hegemony. Many analysts, particularly leaders form China, have opined on the nature of US periodic "harvesting" through dollar strengthening policy which crushes developing (and now even developed) countries so as to maintain their reserve currency status and relative global strength (even conceding that in short term everyone experiences pain as result). Great speech from Qiao Liang, a Chinese PLA Major-General articulating the nature of the reserve $ and the way US uses it as financial weapon particularly when they strengthen it to temporarily crush world economy [1]. [0] https://en.wikipedia.org/wiki/Plaza_Accord https://en.wikipedia.org/wiki/Plaza_Accord [1] http://chinascope.org/archives/6458 http://chinascope.org/archives/6458 ^From link General Qio Lian quote: "Not many people had a clear understanding of this at the time. People, including economists and financial experts, didn’t realize that the most important thing in the 20th century was not World War I, World War II, or the disintegration of the USSR, but rather the August 15, 1971, disconnection between the U.S. dollar and gold." Precient insight into developing Ukraine crises, (speech made in 2015): "Where else did [US] target? Ukraine, the connection between the EU and Russia. Of course there were some problems under Ukraine President Yanukovych’s administration, but the reason that the Americans picked it was not simply because of his problem. They had three goals: teach a lesson to Yanukovych who didn’t listen to the U.S., prevent the EU from getting too close to Russia, and create a bad investment environment in Europe." ^In the context of recent financial sanctions against Russian trade and currency, this is exactly what is happening across Europe right now.

rowanajmarshall 4y ago
> whatever means necessary to weaken $ and help Europe, rest of world I might be misunderstanding something here, but wouldn't a weak dollar strengthen the US economy (in terms of exports) relative to other peer economies (e.g. Euro area, the UK, Japan)?
- PKop 4y ago
  Yes and I think there are often conflicting interests around who gains and who loses even within the US from a strong or weak dollar. But this is why I noted that, every so often US for geopolitical reason seems willing to except even domestic pain for some period of time if the relative position of US increases due to the rest of world suffering more during strong-dollar periods. Give that article a read to understand what I'm saying regarding periodic "harvesting" of rest of world economy (for one, via financial flows into $ and assets as safe haven). Arguably Volcker's extreme tightening in 1970's, with his willingness to crush even the domestic economy for a time, was due to geopolitical interests to maintain trust in the $ as reserve currency and to crush USSR economy by destroying commodity prices and bankrupting their economy partially due to their inability to print the currency of which they had some external debts in. But I think this is a complex topic you can find many arguments both ways. And US policy has gone back at forth at times pursing both strong and weak for their own interest. Though I didn't mean to imply weak dollar wouldn't also boost US domestic economy. But to the thrust of my post which way US regime wants to go depends on current geopolitical context.
reducesuffering 4y ago
How is that last part prescient? That's a year after Euromaidan. Ever since then, 2014, critics have always lambasted any US/EU in support of the Ukrainian people. Why? Because geopolitically Ukraine was meant to be another Belarus, a patsy state, for Russia and its allies. That statement is the opposite of prescient, in that we now see the mask off and the devil that patsy Ukrainian governments were actually making a deal with.
- PKop 4y ago

noir_lord 4y ago

USD is the global reserve currency - when shit goes sideways everyone jumps on the dollar and that pushes it's value up and the value of the other currencies down. In the case of the EU/Euro you've also got an active shooting war, massive inflation and the economic damage that the UK did both to itself and the EU and a bunch of other stuff.

fulafel 4y ago

Currency depreciation forecast from oecd: https://data.oecd.org/price/inflation-forecast.htm#indicator-chart https://data.oecd.org/price/inflation-forecast.htm#indicator...