How long can the US$ hold its dominance & resilience?

PaulRen's picture
Non Thai Article

US$ for now still dominates because its the most liquid currency, by far, around the World.

It could well be the US$ will lose its global status in a few short years, but nobody really knows if and when and what would currency would replace it! My take is it has lost much of its previous attraction and is a dominant currency in slow gradual decline. Its just one side reason I like the prominent exporter here, TOG.  (Sorry for the repeat). 
Here are my short reasons by far rehashed by many far smarter and attuned then me:

The key/core and by a long shot the main reason the US$ is simply -and remains so dominant, is because well, its the dominant one. I.e. the most liquid currency, by far, compared to any other around the World.  Liquidity in mega global transactions or investments, are/is a key component. Neither the EU or any other currency even comes close; so by default the US$ remains dominant. This gives the US many (yes unfair) advantages on US$ and privileges, not enjoyed by any other global currencies' sad but true. 

Imagine you are a global oil exporter country and get billions for this regularly, where are you going to park all this money? Only the US$ can support this kind of liquidity. If you tried to move that kind of money into say the Swiss Franc, EU currency or even the nouveau BRICS it would overwhelm that currency as it simply can't support that kind of mega capital injection -or exit.  Et Voila, the US$ dominates yet again, for mostly that simple lone reason.

The reason this might change is because of (mostly) the US Democrats political machine borrowing trillions of $,  way & well above its means! So to finance all kinds of, often dubious at best aggrandizing projects, overseas as well, which it just can't afford.  US Taxpayers forked out over $100 Bill.+  just for the Ukraine war alone to date, and now more yet again, supporting Israel with huge mind boggling subsidies.  To what end?

Realize, the interest cost on all this debt the US Government has amassed has turned this irresponsibility its biggest single regular expense by far, on just paying for the interest on all its incurred debt!  Mind boggling by any measure.  This US govt. debt irresponsible stratospheric expansion in recent years will one day come to haunt it and may completely destabilize the world and many, like me, think this is the biggest single reason why one day the US$ could rock down, or worse.  Yet for now, where or how are huge global money/capital holders, like petro-dollars supposed to find an alternative to park?   There is none. The EU, the second biggest currency, is far-far behind in allowing  this to become a legit alternative.  Similar with the Chinese currency, on top being one full of restrictions.   So its a "catch 22", if you know the term.  No wonder the price of gold is finally starting to move, manipulated or not.

Paul A. Renaud.