[Steve_American]

The Truth About De-dollarization and What You Need to Know || Peter Zeihan


He gives the 3 reasons that there is no other currency that can replace the dollar anytime soon.

He does not say what happens if the US is forced to default on its debts and payments. However, there is still no other currency that can take over.

https://www.you[==]tube.com/watch?v=xTwwNoh0E6Q&list=TLPQMjQwNTIwMjORbHq_j9avLQ&index=19

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[Fasces]

No single currency is trying to replace the dollar. De-dollarization is about using different currencies for different trades in different regions.

Peter Zeihan doesn't seem to understand that.

[Steve_American]

No single currency is trying to replace the dollar. De-dollarization is about using different currencies for different trades in different regions.

Peter Zeihan doesn't seem to understand that.

Matbe Peter Zeihan doesn't think that it matters much to the American people if nations use their own money to buy stuff. How does this hurt Americans? It may reduce US Gov. power internationally, though.
However, I don't care much about that.
I care about the dollar losing value, but as long as it is the currency that foreigners want to hold, it will not lose much value.
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[late]

He does not say what happens if the US is forced to default on its debts and payments. However, there is still no other currency that can take over.

He doesn't think it will happen because it's senseless economic suicide.

Personally, I think he's in denial about how nuts Republicans have gotten.

[Fasces]

Matbe Peter Zeihan doesn't think that it matters much to the American people if nations use their own money to buy stuff. How does this hurt Americans? It may reduce US Gov. power internationally, though.
However, I don't care much about that.
I care about the dollar losing value, but as long as it is the currency that foreigners want to hold, it will not lose much value.
.

However, that's the issue. Zeihan's market is a bunch of Americans that are living in the 1990s. As the rest of the world develops, and America stops being a unipole, the United States needs to adjust to existing in a pre-1920s multipole. It hurts Americans because even other countries stashing fewer dollars reduces the selling power of American exporters.

Even devolving to a multicurrency model means the US dollar loses value as 'a currency foreigners want to hold'. The US dollar doesn't have to be entirely replaced for the bad effects to start happening, regardless of the value of US currency. If other importers and exporters don't have a bunch of dollars at hand, for whatever reason, the US dollar will start reacting to actual market prices, rather than reserve currency prices. This may affect different products diffrently at other times, and some products not at all, but it will have a noticable effect.

Jet fuel may not melt steel beams, but it does weaken their structural integrity.

[late]

However, that's the issue. Zeihan's market is a bunch of Americans that are living in the 1990s. As the rest of the world develops, and America stops being a unipole, the United States needs to adjust to existing in a pre-1920s multipole.

His overarching theme is that we've already started doing that.

[Fasces]

No, his overarching cope is that the US has started doing that but for XYZ reason (it doesn't matter), the US and its objectives will be OK.

[JohnRawls]

The Truth About De-dollarization and What You Need to Know || Peter Zeihan


He gives the 3 reasons that there is no other currency that can replace the dollar anytime soon.

He does not say what happens if the US is forced to default on its debts and payments. However, there is still no other currency that can take over.

https://www.you[==]tube.com/watch?v=xTwwNoh0E6Q&list=TLPQMjQwNTIwMjORbHq_j9avLQ&index=19

.

There is no alternative to the Euro or Dollar in their areas. The countries who would want to replace the dollar or the euro, can't do it since their currency is not freely traded or freely convertible or free flowing etc etc

The only currency that could replace the Dollar is the Euro realistically but we don't care so we won't take any active steps in to that direction. Market is free willing to use the Euro in the same way as they use the Dollar right now and visa versa.

[late]

The only currency that could replace the Dollar is the Euro realistically but we don't care so we won't take any active steps in to that direction. Market is free willing to use the Euro in the same way as they use the Dollar right now and visa versa.

The European economy is already under heavy stress. Our default would make matters worse. I doubt other countries would want the EU as a reserve while Europe was bordering on economic depression.

There is a very real possibility that the dollar would remain as the reserve, at least for a while. Granted, it would hasten the end of the dollar as the reserve currency.

A default could shatter the coalition helping Ukraine. That has all manner of potentially messy implications.

[JohnRawls]

The European economy is already under heavy stress. Our default would make matters worse. I doubt other countries would want the EU as a reserve while Europe was bordering on economic depression.

There is a very real possibility that the dollar would remain as the reserve, at least for a while. Granted, it would hasten the end of the dollar as the reserve currency.

A default could shatter the coalition helping Ukraine. That has all manner of potentially messy implications.

We will survive. Our economy is our economy. US economy is US economy. Both economies feeling bad is literally the worst case scenario for all of the world but once again, we are independent economies that can manage without each other but with downsides.

If we you haven't noticed, we survived no problem and already discarded all of Russia gas and oil. Well 95% of it. We also have plenty of money.

My point being, Europe doesn't want to replace the Dollar as reserve currency since the Euro is already to a smaller degree a reserve currency. We have our own, we don't particularly care how good the Dollar does as long as the Euro does good and the Dollar situation doesn't hurt us. Which once again, It would if US defaults but so would any default of Europe or Euro.

US default wouldn't put a dent in the coalition. At least European commitment to it.

[JohnRawls]

The European economy is already under heavy stress. Our default would make matters worse. I doubt other countries would want the EU as a reserve while Europe was bordering on economic depression.

There is a very real possibility that the dollar would remain as the reserve, at least for a while. Granted, it would hasten the end of the dollar as the reserve currency.

A default could shatter the coalition helping Ukraine. That has all manner of potentially messy implications.

I will also add one more thing. Default would send credit risk sky high(and interest) for all countries but Europe is the least indebt place in the world if you talk about the largest economies of scale:

1) US is at around 125%
2) Japan is at 220%
3) China is like 300% if not more.
4) India is 92%
5) EU as a whole is 81% and if you exclude PIGS then it is around 60% if not less.

Just for some comparison.

[Beren]

The challenge to the US dollar as a reserve or trade currency seems overhyped to me. The US economy isn't just big, it's also diverse and simply put the best (major) economy with the best financial system in the world, and it also has a history. As JohnRawls has pointed it out the USD is also freely traded and very convertible. Although the Chinese economy is also big and China trades a lot, its currency is still as relevant a reserve currency as the Canadian dollar is. Meanwhile, China's economic growth has been slowing and it's expected to be slowing further in the future, so if they don't change the way their currency is traded, then I wouldn't expect it to ever challenge the USD successfully.