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My base case is still that the USD being the reserve currency is the problem. There will persistently by more demand for USD than is justified by the need to pu
by TapWaterBandit 2y ago
My base case is still that the USD being the reserve currency is the problem. There will persistently by more demand for USD than is justified by the need to purchase American exports, so the currency is artificially high. This makes their exports more expensive than they should be relative to others, which hurts manufacturers.
Having a currency that is too strong for your economy always does this, look at the situation in European nations under the Euro.
- MrMan 2y ago[dead]
- panick21_ 2y agoUSD has been the defacto reverse currency since basically WW1 and even more so after WW2.
- TapWaterBandit 2y agoAnd this has been a major problem for them since then. Look up the "Triffin Dilemma". If a nation's currency is the reserve currency it pretty much must run a trade deficit and one of the major impacts will be loss of manufacturing prowess. Happened to Great Britain when the Pound was the reserve currency too.