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De-dollarization: Is the US dollar losing its dominance? (2025)

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Re: De-dollarization: Is the US dollar losing its dominance? (2025)

#731

Post by gamacodre »

spicyusername wrote: post #181
znnajdla wrote: post #131

Earlier quoted context omitted.

A goat or a sheep cost roughly the same in gold today as it cost 2000 years ago during the Roman Empire. Gold is the only “real money” in the sense that it is the only stable measure of the value of basic needs over centuries. https://chatgpt.com/share/696fb3e8-91d4-800a-9b2b-32eacdadeb...

First link to ChatGPT as a "source" that I've seen in the wild. Times they are a-changing. I can't say that anyone is going to find that very convincing, even if it's a compelling idea to consider gold inflation over the centuries.

Yeah, I saw that link and had a few thoughts immediately collide in my head:

    - Wait, WTF? Really??
    - But but but it's a *chatbot*, not an authority 
    - We're doomed

Re: De-dollarization: Is the US dollar losing its dominance? (2025)

#733

Post by JumpCrisscross »

netbioserror wrote: post #430
JumpCrisscross wrote: post #303

Earlier quoted context omitted.

> Say what you will about how dated a gold standard is, but it forces immediate fiscal responsibility upon governments We were on metal standards for millenia. Governments routinely spent beyond their means, including for imperial aims. This is like four centuries of Roman history.

What @cheeseomlit said, plus: During the Age of Exploration/Colonization, competing European powers each minted metal currencies and couldn't reasonably debase their metals without immediately being out-competed (which is why the trusted purity of Spanish gold and silver coinage slowly dominated). The primary mode of failure for those empires was bankruptcy via war. The impossibly high cost of fielding armies around…

> During the Age of Exploration/Colonization, competing European powers each minted metal currencies and couldn't reasonably debase their metals without immediately being out-competed

You're hitting the nail on the head. Metalness didn't matter. It was competition in money supplies (and strength of private property).

The fact that a banker in Italy could finance (or not) a war by Great Britain is what restrained governments. Same as in the 1990s, the bond market was king.

The historical record simply does not support the hypothesis that metal-based economies are more peaceful or inflate less than modern fiat-based ones. I'm open to revising that opinion if someone has re-run the data. But everything I've seen comes from blogs that start with the conclusion, itself reached from assumptions from first principles that rarely contemplate how armies were actually financed in antiquity. (Hint: they take your shit. Marketing campaigns sharing the martial term isn't a coincidence. If you're a general in the olden times, you got wealthy through your commission because your army took the enemy's shit. If you needed help getting there, you paid a 'friendly' visit to your nobles.)

Re: De-dollarization: Is the US dollar losing its dominance? (2025)

#734

Post by terminalshort »

jyounker wrote: post #607
terminalshort wrote: post #567

Earlier quoted context omitted.

I would argue that not only is it not the most likely outcome, but that it's practically impossible. When the colonies united they all spoke the same language and shared the same culture as the descendants of recent British colonists. Furthermore, they had just fought and won a war of independence together. The first presidential election was unanimous with every single electoral vote backing George Washington. Do yo…

There are still, to this day, massive wealth disparities between US states.

And until the first entitlement programs during the New Deal it made no difference because it was entirely the poor state's problem. Only after the country had been a political union for over 150 years did they have any sort of welfare transfer program. If New Yorkers had been told in the late 1700s that joining the union would mean taxes coming out of their paycheck to send money to people in Georgia, they never would have joined.

Re: De-dollarization: Is the US dollar losing its dominance? (2025)

#735

Post by legitster »

chrisco255 wrote: post #663
legitster wrote: post #273

Earlier quoted context omitted.

> Nobody is cheering for inflation to get worse, they are celebrating it being held down to 2.7% after higher inflation a few years ago. Trump is actively fighting the federal reserve to drop the interest rate to 0%. Members of his team regularly do interviews where they say "it's going to get worse before it gets better". Inflation is being held down despite this administration's best efforts. > The U.S. is a net ex…

> Trump is actively fighting the federal reserve to drop the interest rate to 0 The interest rate was near 0 for years, it did not cause inflation. Fighting for low interest is not same as being pro-inflation.

The reason it was 0 for so many years was because the Fed was trying desperately to create inflation during this time. (Which was chronically low for other reasons).

Lowering interest rates to create inflation is literally one of the core tenants of the Federal Reserve:

https://www.clevelandfed.org/center-for-inflation-research/i...

Re: De-dollarization: Is the US dollar losing its dominance? (2025)

#736

Post by JumpCrisscross »

legitster wrote: post #394
JumpCrisscross wrote: post #289

Earlier quoted context omitted.

> it can just impose tariffs on imports to do so This is how you grow a sclerotic, internationally-uncompetitive domestic industry. See: shipbuilding. Where tariffs work is as a nursery policy. Give firms a safe haven to grow in. Then let competition hone them. South Korea has pioneered this playbook; China copied it. We were sort of doing it, but the current administration blew up our nascent new energy industry.

It's also debatable how important tariffs even are for "infant industries". In most situations, if you ever remove the tariffs, the native industry is just as likely if not more likely to die out to any serious foreign competition. For South Korea and China, tariffs were not a very key part of their industrial policy. Which is not to say that the government didn't have a massive hand in the success of their native in…

> For South Korea and China, tariffs were not a very key part of their industrial policy

Cars were absolutely incubated by Seoul. In part through drastic trade protections.

Re: De-dollarization: Is the US dollar losing its dominance? (2025)

#737

Post by JumpCrisscross »

chrisco255 wrote: post #666
margalabargala wrote: post #461

Earlier quoted context omitted.

Solar, wind, and grid-attached battery. In the late teens, China was dominating all of these industries. Under policies of the Biden administration, these industries were growing domestically in the US and we were increasing our share of the global market. Over the last year those domestic industries have been destroyed. They are barely surviving and have stopped rapidly expanding. All gains made against China's domi…

Any links to data on these claims?

Which part?

Re: De-dollarization: Is the US dollar losing its dominance? (2025)

#738

Post by ActorNightly »

saulpw wrote: post #412
russdill wrote: post #374

Earlier quoted context omitted.

We print money, send it around the world, and the world sends us goods. It was a great thing.

For us individually. For us collectively it was a horrible thing. We lost the means and incentive to produce anything durable, including a healthy, educated, sustainable society.

Yes... so lets vote someone in that does all the things towards creating a less healthy, less educated and less sustainable society.

US was doing just fine btw. I know this because people like you blow the small issues way out of proportion, and the reason this haplens is that there is no real issues to worry about.

Re: De-dollarization: Is the US dollar losing its dominance? (2025)

#739

Post by tim333 »

StealthyStart wrote: post #732

I have been interested in this topic for a while now, and have run different scenarios. What is everyone's thought on Chinese Yuan or Euro as the reserve currency?

The Yuan isn't free floating enough. Banks will probably hold a mix of currencies including the Euro and others.

Re: De-dollarization: Is the US dollar losing its dominance? (2025)

#740

Post by throwaway7644 »

qwytw wrote: post #722
throwaway7644 wrote: post #682

Earlier quoted context omitted.

We've witness deflationary forces in computer hw for decades and no one is holding off their purchases. Time is scarce and it ultimately forces consumption because otherwise, what would you be saving for? Don't need Econ 101 to understand this basic reality.

Well there is a difference between people not buying anything at all and being significantly less than they are now. Consumer goods and services is only the tip of the iceberg. How much do you think debt would cost and how easy would it be for businesses to get credit? Combining a deflationary currency with a growing (or at least non static) economy is bad a everyone who has a basic understanding of history prior to…

You're forcing business to produce something valuable in real terms instead of nominal terms and you're making that calculation easier to do for economic actors because the measuring stick is now controlled by an algorithm as opposed to charlatans.

Having less of that garbage fiat short-termism is a good thing for society.

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