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I don't buy the assumption that others are "subsidizing" the USD when they choose to use it -- they're choosing to use USD for their own benefit.
by LUmBULtERA 2y ago
I don't buy the assumption that others are "subsidizing" the USD when they choose to use it -- they're choosing to use USD for their own benefit.
- r3trohack3r 2y agoI disagree with OPs conclusion but not the thesis. I do, currently, think there is some level of “subsidizing” (wrong word) happening in the west. USD is the wests reserve currency. It’s held by many western countries and much of western trade is denominated it in. When the US prints money, they dilute the western reserve currency. It lets the US spend the value of every USD holder (including the value of debt denominated in the currency). In other words, I think the US can spend the value of a large slice of the western economy (not just its domestic economy) on its own infrastructure and military projects through inflation by printing money.
- marcosdumay 2y ago> USD is the wests reserve currency. Kinda. US treasure bills are the main world's reserve actives. But the world also holds other kinds of active, and none of that is exactly caused by the dollar denominating trade. Trade denomination causes some inflation exporting that can mess with other economies due to price stickness. But again, that's nothing like the OP claims.
- adamnemecek 2y agoChoosing is the wrong word as there aren’t many other choices.