The US dollar has been stable (more or less) ever since Roosevelt’s war. Because of that stability, it has become the “reserve currency” of the world. It is the de-facto medium of exchange around the world. All oil purchases and other transactions are done in US$. Around the world, from places like Argentina, to Russia, and Zimbabwe, people trust the dollar and save it because they can no longer trust their own government to be responsible.
Those billions of US$ floating around out there are like a giant interest free loan. We have purchased “stuff” with those dollars and now they are being used for other things. If people ever lose faith in the US$, all of that will come home. And people around the world will no longer buy dollar denominated securities-like “T” bills. That would be a crippling blow as some 40% of our government spending is borrowed.
Unfortunately, the current regime is proving to be as irresponsible as any third world banana republic. I have mentioned in the past how our major creditor, Communist China, is becoming very nervous. Here is a story about how the Russians are trying to end the dominance of the US$. In the meantime, “He Whose Middle Name Cannot be Spoken” is floundering in a sea of oil with no clue as to what is going on. His and the Democrats profligacy are heading this country for a catastrophe.
Pray for our country.
Steamboat Jack (my evil twin)