Of course it is, the europeans have been kidding themselves, but at the same time we have this team of clowns running our own economy into the ground...the fact that the dollar is the currency of last reserve, knowing what we know about U.S. debt levels, is a terrifying statement about the rest of the global economy and monetary system.
What happens if a country tries to pull out of the Euro? I mean is there even a precedent for it? If someone (say Luxemborg) does pull out do German soldiers go marching in to make them change it back?
Given that, what happens when all the other countries that's shifting their funds into dollars realize that the dollar is quickly becoming just as worthless as all the rest? Do they all panic run to gold as the last reserve of value? Just wondering out loud.
Bingo - ping.
Yes, it does, but it also make a strong statement about the American system of currency and banking.
The rest of the world lacks a Federal Reserve, they lack our experience, they lack our flexibility.
The Euro, especially, is a very queer duck of a currency. They have a central bank, but it cannot act as a lender of last resort easily. They don’t have a single treasury, they have over a dozen of them. They don’t have one banking system, they have over a dozen of them. They don’t have one consistent code of banking, finance or market regulation - they have over a dozen.
As bad as our liabilities are, the liabilities in the Euro-zone are worse. Much worse.
A sad day when even the good news is terrifying, LOL.