Behind every dominating currency stands an authority, be it a king or a form of government, who enforces its legitimacy and value. It's the ability of said entity to replenish its coffers, to manage its finances quickly and efficiently in times of deep crisis, be it a war, or something else of various nature, that makes or breaks the dominance of its currency. As long as current form of US government exists in any meaningful way, and be able to finance itself quickly and efficiently, through crisis of its own making or of some other nature, USD is here to stay.
American Economics Thread
- Thread starter Bernard
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Behind every dominating currency stands an authority, be it a king or a form of government, who enforces its legitimacy and value. It's the ability of said entity to replenish its coffers, to manage its finances quickly and efficiently in times of deep crisis, be it a war, or something else of various nature, that makes or breaks the dominance of its currency. As long as current form of US government exists in any meaningful way, and be able to finance itself quickly and efficiently, through crisis of its own making or of some other nature, USD is here to stay.
That capability is now up for debate.
When, not if, AR kicks off and make no mistake America will get militarily involved, 2 or 3 US carrier groups getting sunk will immediately disspell any notion of American escalation dominance (unless we talking about nuclear WWIII then currency will be the least of anyones concerns) and without that there goes the international monopoly of violence that enabled the US as the sole unilateral hegemony that held the worlds energy hostage including acting as defacto mafia to OPEC with its "protection" scheme via petrodollar hegemony that propped up the USD after Fort Knox turned up empty of gold bars during the end of the Brentwoods era...
China is now the worlds largest trading partner, not the US, who doesnt even having a manufacturing base left in its homeland after its MMT theory FIRE'd up its eCONomy... Most of the US bases in Asia are just to keep vassals in check, totally useless for anything else and more of a reputation liability when hot war actually breaks out with China.
Which is why US with CHIPS4 is trying to bring the most critical IC fab ability back to the homeland asap, and dual prong intent to again extent the USD lifespan by way of making computer chips the new digital oil and US chokehold on semiconductor fab industry as its next meal ticket to forcing the world to continue to pay usury taxation to the US by way of using dollars else hit with blanket chips sanctions etc... Problem with this plan is China can strike TSMC faster than US can build up its fabs in the AZ and unlike oil in which China was not naturally blessed like the Middle East, China has already broken through the US semiconductor containment as its as unstoppable by US now as was futile when ancient China tried to prevent Europeans from learning the secret of how silk was made....
Finally globally deminishing EROEI means America on top of the energy tropic food chain pyramid structured as it is both as an empire and also domestic internally will actually suffer the hardest and the worst. Remember modern money is but a claim on future ability of energy deposit to do work. The world isnt all going to cannabalize themselves and commit mass suicide for the sake of propping up the USD while American printers go brrrr as the Federal Reserve continues its QE to infinity... not unless Russia, China and Iran all decide to surrender to Uncle Sam unconditionally and for no reason... If that were the case I dont think Xi would be making his trip to SA with SA not picking up Bidens frantic phone calls
It's simply a function of how much comes in from where and how much goes out to where. It depends on few hundred people's focus, or maybe a few dozens', wherein lies the danger of imperial hubris, over extending the reach, especially the economic weight of rising China keeps growing. China fundamentally sees it as an economic contest since opening up and joining the WTO. She will simply outgrow to rival, and possibly bury, USD under her shadows.
This. Pointing out that the American economy is on a death spiral has nothing to do with Chinese or any other nationalism. It's a position held by an increasing number of economists, including American ones.
If anything I'd say it is American nationalism and hubris that prevents them seeing how precarious their position really is. America is currently dealing with significant political and social divisions, a ballooning fiscal deficit, a bloated and corrupt MIC, an expensive and morally bankrupt foreign policy and so on.
antiterror13
Brigadier
As you can see, Americans have quite extensive complex system in place to keep itself in a highest spot. For how long would it last? Nobody could ever say it definitively one way or the other with any degree of certainty. Anybody who would come up with a certain expiry date for USD is simply rubbing something shiny one too many times very hard. As it stands and functions as of today, it'd be extremely beneficial for China to actually learn and replicate the pieces of the American system where they benefit China. America is arguably the greatest empire in entire human history, so they say, so why should China let it go to waste, not observing and learning as it lives and breaths? I don't think anybody in China's governing body would have thought or written off USD or US just yet. So hold off your obituary and eulogy for USD and US.
Yes, of course, what else could I be referring to? The quality? Chinese are the most intelligent, talented and hardworking people in the world.you meant the "SIZE" of the population ?
Complex systems fail in cascading and unforseen ways. Nobody thought the US power grid could fail in 2003.
Anyone with a functioning brain would have observed all systems, natural or man made, would decay and ultimately stop some parts of it from functioning well or at all. If you need a wiki page to prove that, at least it's a good thing you have wiki handy.
Just hope ill will doesn't blind anyone to strength and weakness alike.