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Your neighbor was right. It seems you are confusing, maybe conflating, at least partially, general price inflation/local purchasing power metrics, currencies held as central banking reserves and dollar strength relative to other currencies.
The dollar will, and has been, strengthening as the Fed. increases the FFR.......over the last month the $ is up against the Euro, yen and Renminbi/yuan. FWIIW the $ is up against the yen and Euro over the last 12 mos as well.
Right now for every Renminbi held as reserve there are $21 held as reserves. Let me know when the Renminbi/yuan moves into 4th place as a reserve currency past the Pound. Further, $s as reserves increased more than the Renminbi last year.
A final factor is a little in the weeds but because we run a trade deficit with the Chi-coms they must hold lots of $.......that factor alone will keep the $ as the key reserve most likely for many decades.
The problem is the FFR has been at historic lows for far too long and any significant uptick will land us in a recession. The amount of tools in the Fed's toolbox to manipulate the economy is dwindling fast. Alan Greenspan really screwed us!
You must be dem controlled public school "educated"!
Thread FAIL, BIG TIME!
Why are we #2 when we were #1? Second, we are a distant 2nd in manufacturing. When it comes to heavy manufacturing (steel production) we are a joke. Your post is a fail....BIG TIME!
The is no ability, or indeed, intention, to ever repay a cent of this debt. This debt will grow larger and larger until the financial system simply collapses under its weight. One day, we will all wake up in the morning to find the banks closed indefinitely, and all the ATMs out of service, and no one will have seen it coming...
The masses, the politicians, and the "experts" think this debt can keep growing ad infinitum. This goes against the basic laws of physics, and of common sense. There cannot be perpetual debt expansion in a finite realm. Something has got to give. And something will give.
I agree. We are in the most critical point in my lifetime. We have a debt that if divided by every U.S. citizen is north of $80K per person. Now that inflation is upon us the Fed is forced to increase interest rates which in turn will cost all of us more to pay off the national debt. There may come a time that the U.S. may at some point in the future sell off some of it's foreign assets. I just don't see how we get through this without a very long road of stagflation for the unlucky generation that will be saddled with this..
The dollar is up against the Japanese yen, which helps explain things.
Looks like Japan is finally getting that inflation they've been begging for for the past 30 years (which was an erroneous thing for them to do. The lack of inflation is never a problem).
The problem is the FFR has been at historic lows for far too long and any significant uptick will land us in a recession. The amount of tools in the Fed's toolbox to manipulate the economy is dwindling fast. Alan Greenspan really screwed us!
Given that we saw a real GDP of minus 32%+ the second quarter of 2020 higher interest rates in the recent past would have been disastrous policy.
Looks like Japan is finally getting that inflation they've been begging for for the past 30 years (which was an erroneous thing for them to do. The lack of inflation is never a problem).
Just about every credible economist at least since 1850, especially Friedman, would disagree with you.
Normalcy bias. Pretty common. Well... common until the bottom falls out.
Aside from an asteroid hit, we will have fair warning and time. As there is no other currency to take its place.
What Would It Take for the Yuan to Dethrone the Dollar?
China would have to float the yuan.
End capital controls
Respect property rights
Have a bond market big enough (China has virtually no gov't bond market)
Inspire global trust
Be willing to have trade deficits
Stop export mercantilism
Have a currency market big enough
Perhaps China meets condition 8. It flunks the first 7.
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