“The U.S dollar remains the world reserve currency because, so far, it has no contenders.”
Unless space aliens from a world with a stronger currency land on earth, for the foreseeable future, the dollar will be the world’s reserve currency.
If that is not your view, you should take all your dollars, head to the bank and covert all your dollars to reals, pesos, euros or rubles.
Now that Russia and China have ‘bonded;,....
the gig is up.
Foreign nations might insist on bonds based on a percentage of federal and state tax and fee revenue.
A billion dollars might be repayable at say 1/8000th of such revenue and bear an annual interest charge of say 1/400000th of such revenue.
MMT is quite clear that the supply of money that a currency issuer creates to pay for entitlements and fiscal needs can not exceed the productive capacity of the country without causing inflation.
Obviously, by improving productivity and using innovation to reduce unit costs, the private economy can expand up to the limits of available labor. There is no theoretical limit to this growth as long as we don’t artificially suppress it by obsolete regulations, anti-competitive business practices, or political stupidity.
No currency has any “intrisic” value. All sovereign currencies only have relative value to other currencies on the foreign exchange market based on floating exchange rates. The reason the dollar remains strong is because we have certain advantages in our productive capacity that are not available in other countries. That can fluctuate daily, but as long as the supply of currency in public hands doesn’t exceed its productive capacity, the absolute number of dollars is irrelevant.
The Fed is like the banker in Monopoly. One of its first rules is: “The Bank can never run out of money. If more money is needed it should use plain paper.”
Let’s just wait and see how BRICS plays out... it might get real ugly
We've even turned former allies like Saudi Arabia against us. We've turned Iran and Turkey against us. And, worse, we pushed Russia into an alliance with China.