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Japan's real limitation here is primarily that they're relatively small (1/3 the size of US/EU), and their most "aligned" neighbors (Korea, Taiwan, Phillippines
by scythe 4y ago
Japan's real limitation here is primarily that they're relatively small (1/3 the size of US/EU), and their most "aligned" neighbors (Korea, Taiwan, Phillippines) don't like them very much. It's not like you could reasonably fit many more people on the islands as it is.
US wealth distribution is much flatter than European. The GDP/capita ratio between Mississippi and Connecticut is less than 1:2, while for Germany to Hungary it's more like 1:4.
China is... China. You can't call yourself the Communist Party and run the global financial system. The world can only tolerate so much contradiction.
The open question now is whether the dollar can be dethroned by nothing: can a basket of currencies become the default reserve?
- bwanab 4y ago<The world can only tolerate so much contradiction.> My guess is the world can tolerate it as long as everybody is making money off it. When that stops, the contradiction might seem intolerable. The world needs a default reserve that's not tied to any single central bank. For all the upsides there are also real downsides for the US having its currency as the default reserve.
- neffo 4y agoIt does exist. See SDR/XDRs: https://en.wikipedia.org/wiki/Special_drawing_rights https://en.wikipedia.org/wiki/Special_drawing_rights
- another_story 4y agoTaiwan and Japan are pretty close, actually. You'll find few people in Taiwan that dislike Japan. The rest, yah.
- milton0825 4y agoYeah this is true