[Puffer Fish]

Europeans are facing a new economic reality, one they haven't experienced in decades. They are becoming poorer.

Adjusted for inflation and purchasing power, wages have declined by about 3% since 2019 in Germany, by 3.5% in Italy and Spain and by 6% in Greece.

High energy costs and rampant inflation at a level not seen since the 1970s are dulling manufacturers' price advantage in international markets.

Spending on high-end groceries has collapsed.

The article goes on to cite examples of middle class families complaining about expenses and cutting back.

article: Europeans Are Becoming Poorer. 'Yes, We're All Worse Off.' , Wall Street Journal, Tom Fairless

[late]

Zeihan predicted this months ago.

It's a combination of demographic aging of the pop. with the problems that arise from war.

The good news is that they have adapted to this better than anyone expected.

Unfortunately, the world that made their prosperity possible has ended, and it's not clear what they can do about it to get it back.

[Red Rackham]

Of course Western Europe is getting poorer. Thanks to the EU policy of open borders and mass uncontrolled immigration coupled with net zero the chances are the €urozone will become significantly smaller and both the EU and the UK will in all likelihood become low wage overpopulated tier 3 economies by the end of the century. Yay progress.

[Dimetrodon]

The entire west is getting poorer, with each new generation now expected to be even poorer than the last, and that is due to neoliberal economic policies that centralize wealth and power in the hands of the wealthy.

Over time, these people reduce real wages, increase prices, and take advantage of lack of unionization and a government that is on their side to pay newer generations less and less.

[Politics_Observer]

@Random American Nails it again. It's going to take people in the West to understand they have to bring back unions and get more unions lobbying Congress.

[B0ycey]

If you think the West is worse off now, think what will happen if the Dollar loses reserve currency status? Nations are starting to trade with their own currencies to protect themselves from US sanctions and Saudi Arabia have joined BRICS who are instrumental in keeing the status of the PetroDollar going. All the emerging nations are now in BRICS and if they set up an alternative to the Dollar as they plan on doing, I can see a financial crash on the horizon.

[late]

If you think the West is worse off now, think what will happen if the Dollar loses reserve currency status? Nations are starting to trade with their own currencies to protect themselves from US sanctions and Saudi Arabia have joined BRICS who are instrumental in keeing the status of the PetroDollar going. All the emerging nations are now in BRICS and if they set up an alternative to the Dollar as they plan on doing, I can see a financial crash on the horizon.

There is no threat to our reserve status. Nor will be there one this decade.

[B0ycey]

There is no threat to our reserve status. Nor will be there one this decade.

Misplaced confidence. There is no immediate threat but nations are actively moving away from the Dollar and trading with their own currencies now because they are fed up with the threat of sanctions when not siding with American politics. Saudi Arabia joining BRICS should be a concern in any case given they are a large oil market and a bigger concern would be a BRIC currency given the BRICS expansion includes pretty much ALL the emerging markets.

[Unthinking Majority]

COVID inflation, and maybe Russia energy. Hopefully not an extended trend.

[late]

Misplaced confidence. There is no immediate threat but nations are actively moving away from the Dollar and trading with their own currencies now because they are fed up with the threat of sanctions when not siding with American politics. Saudi Arabia joining BRICS should be a concern in any case given they are a large oil market and a bigger concern would be a BRIC currency given the BRICS expansion includes pretty much ALL the emerging markets.

Like Zeihan says, this pops up from time to time, nothing comes of it.

[B0ycey]

Like Zeihan says, this pops up from time to time, nothing comes of it.

But something is coming from it. The system we operate in is Dollar centric and thats true now as it has been since WWII. But nations are actively working away from that model as we speak and putting in new systems in place.

https://www.reuters.com/world/indias-mo ... 023-09-10/

It will take time but I do think the Dollar will lose reserve currency status. And when that happens the banking system will have some form of collapse and we'll have greater inflation issues than even now.

[late]

It will take time but I do think the Dollar will lose reserve currency status.

When the empire falls, so will the perks.

But even then, reserve status usually outlasts the empire for a while. The new guy has to establish clear dominance.

The House Krazy Kaucus may bring us down. If they get stopped, there is no one out there to replace us...

That means a collapse of the current financial global order, chaos, not a new empire.

[Puffer Fish]

But even then, reserve status usually outlasts the empire for a while. The new guy has to establish clear dominance.

The British pound was the premiere world currency until World War 1, and even sort of half lasted all the way into the 50s.
So based on that, we might expect it to take around 25 to 35 years for a currency to totally lose its global status.

You can see the graph in this link https://cepr.org/voxeu/columns/when-did ... dence-bond