The Dollar's Dominance Not Really Being Challenged

[Walt]

[The Dollars] share slipped from 71% of global reserves in 1999 to 59% in 2021. The phenomenon is widespread across a variety of central banks, and cannot be explained away by movements in exchange rates.

The findings reveal something compelling about the dollar’s new competitors. The greenback’s lost share has largely translated into a bigger share for what Mr Eichengreen calls “non-traditional” reserve currencies. The yuan makes up only a quarter of this group’s share in global reserves. The Australian and Canadian dollars, by comparison, account for 43% of it. And the currencies of Denmark, Norway, South Korea and Sweden make up another 23%. The things that unite those disparate smaller currencies are clear: all are floating and issued by countries with relatively or completely open capital accounts and governed by reliable political systems. The yuan, by contrast, ticks none of those boxes. “Every reserve currency in history has been a leading democracy with checks and balances,” says Mr Eichengreen.

https://www.economist.com/finance-an...-of-currencies

So basically, central banks are trying to diversify from the Dollar, but into Australian Dollars, Canadian Dollars, Danish Krones, Norwegian Krone, Swedish Krona, and South Korean Won. These are all liberal democracies, with independent central banks. They are very similar to the USA. No one wants to use Chinese Government control Yuan, or worse yet Putin controlled Ruble. Both Yuan and Rubles have been defaulted on, and may well be defaulted on again.

[Lightbringer]

https://www.economist.com/finance-an...-of-currencies

So basically, central banks are trying to diversify from the Dollar, but into Australian Dollars, Canadian Dollars, Danish Krones, Norwegian Krone, Swedish Krona, and South Korean Won. These are all liberal democracies, with independent central banks. They are very similar to the USA. No one wants to use Chinese Government control Yuan, or worse yet Putin controlled Ruble. Both Yuan and Rubles have been defaulted on, and may well be defaulted on again.

It's all the same shit dude, you know that. American dollars are for the hoi polloi, it's the western reserve that matters.

But, the takeaway I got from your link is that China will attack and occupy India within 8 years.

[Walt]

American dollars are for the hoi polloi, it's the western reserve that matters.

The Dollar is both for the hoi polloi, and for the elites. It is not for those in world poverty.

Most western reserves are in Dollars.

But, the takeaway I got from your link is that China will attack and occupy India within 8 years.

I could see China and India pushing up against each other, and moving the borders a bit, but there is no way China could occupy all of India. India is large, with a people with a firm sense of nationalism, and also nuclear weapons.

[Lightbringer]

The Dollar is both for the hoi polloi, and for the elites. It is not for those in world poverty.

Most western reserves are in Dollars.



I could see China and India pushing up against each other, and moving the borders a bit, but there is no way China could occupy all of India. India is large, with a people with a firm sense of nationalism, and also nuclear weapons.

1. You just posted an article about the move away from American dollars. You can't have it both ways on this.

2. China has no choice, they have to dominate India because they can't have Africa without dominating India.

[Hawkeye10]

Here is the really big question: How could Walt possibly be wrong so often.

Apes throwing darts at a board would turn up more right than our Walt does.

[Hawkeye10]

1. You just posted an article about the move away from American dollars. You can't have it both ways on this.

2. China has no choice, they have to dominate India because they can't have Africa without dominating India.

India will throw in with China because at this point it would by moronic to bet on the stunningly rapidly dying West.

[Lightbringer]

India will throw in with China because at this point it would by moronic to bet on the stunningly rapidly dying West.

If India were smaller I'd agree with you but they are a large country and can't do that. India is in with Russia, not China.

[Walt]

1. You just posted an article about the move away from American dollars. You can't have it both ways on this.

My article is about the continued dominance of the Dollar, not a move away from it.

2. China has no choice, they have to dominate India because they can't have Africa without dominating India.

India and Africa are not really connected. Besides, recent deadly conflicts have been between China and India. It is one of the many different cold wars that might go hot, and cause a nuclear war.

[Walt]

India will throw in with China because at this point it would by moronic to bet on the stunningly rapidly dying West.

India is a regional superpower, just like China. They have violent border disputes with China. They are no where near "throwing in" together.

[Walt]

If India were smaller I'd agree with you but they are a large country and can't do that. India is in with Russia, not China.

India and China are both allies with Russia, but not with each other. Both are having trouble actually gaining anything from an alliance with Russia.

[Matt Dillon]

https://www.economist.com/finance-an...-of-currencies

So basically, central banks are trying to diversify from the Dollar, but into Australian Dollars, Canadian Dollars, Danish Krones, Norwegian Krone, Swedish Krona, and South Korean Won. These are all liberal democracies, with independent central banks. They are very similar to the USA. No one wants to use Chinese Government control Yuan, or worse yet Putin controlled Ruble. Both Yuan and Rubles have been defaulted on, and may well be defaulted on again.

So you say...

The US lack of production and inability to export surpluses due to Biden policies is definitely not going to strengthen the petrodollar any.

[Walt]

So you say...

The US lack of production and inability to export surpluses due to Biden policies is definitely not going to strengthen the petrodollar any.

The markets and central banks of the world say. You are free to disagree, and if you want to invest against the markets, and are right, in theory, you could make some money.

[Matt Dillon]

The markets and central banks of the world say. You are free to disagree, and if you want to invest against the markets, and are right, in theory, you could make some money.

Oil futures? Too volatile.

[Walt]

Oil futures? Too volatile.

FX or FX futures. You say that the Dollar is going to crash, well put your money where your mouth is.

[Lightbringer]

India and China are both allies with Russia, but not with each other. Both are having trouble actually gaining anything from an alliance with Russia.

You think China is a Russian ally?