New Global Monetary System?

[new_trader]

Will the $U.S Dollar lose its reserve status as a result of the COVID-19 crisis? What will replace it?

 

[MasterOfCoin]

Will the $U.S Dollar lose its reserve status as a result of the COVID-19 crisis? What will replace it?

I wouldn't care to speculate on the first question.
Other than to muse that the U.S. would probably embark on WW3 before giving up that currency status......

What should replace it is a decentralized cryptocurrency that no single state entity or actor could stand any chance of controlling, but there's bugger all chance of the central banks giving up their monopoly on power, that's certain.

Which means that what we'll see touted about is some kind of centrally controlled digital currency that would allow Governments to ditch horribly anonymous cash in favour of lovely 100% traceable transactions.

Money, or rather the ability to create it and control where and how it is used, is power.

Those who have power will use it to keep power. History tells us that they are not usually inclined to relinquish it without a fight. War, death, famine and disease through poverty are the inevitable consequences.


PS.

The average lifespan of a 'fake' ie. fiat currency is circa 40 years or so.
By this measure, present currency is overdue demise.

But the longevity varies considerably, from a few months to several hundred years.

They have, however all ultimately failed through spiraling debt-flation bringing about their demise.

Does that begin to sound familiar?......

 

[Nowler]

Will the $U.S Dollar lose its reserve status as a result of the COVID-19 crisis? What will replace it?

I'm going to go with....
The Chinese, or a Cryptocurrency.
Maybe both?

 

[Nowler]

The US days are numbered.
Out with the old and in with the new I say!

They are bogged in debt with no way of offloading it - apart from defaulting, which would crucify them.

 

[MasterOfCoin]

They are bogged in debt with no way of offloading it - apart from defaulting, which would crucify them.

There is the minor consideration that they have rather a lot of aircraft carriers drifting around the place dedicated to offloading it onto 'willing' 'supporters' of 'freedom' and 'democracy' !

 

[new_trader]

There is the minor consideration that they have rather a lot of aircraft carriers drifting around the place dedicated to offloading it onto 'willing' 'supporters' of 'freedom' and 'democracy' !

"Generals are always prepared to fight the last war"

IMO: Drones and hypersonic missiles will make Aircraft carriers obsolete, just like the battleship. They are just a huge, expensive target.

 

[Nowler]

Will the $U.S Dollar lose its reserve status as a result of the COVID-19 crisis? What will replace it?

I'd like to see this question discussed more.
It's a very interesting question, and something that profoundly impacts each and everyone of us.

It's not unreasonable to say that the threat of hyperinflation hangs over our heads.
Nor is it outlandish to say that the end of the FIAT is near.

I think the last 12 years has shown that were are likely near the end of the system as we know it.

What are the likely alternatives?
And how might this unfold?

 

[Nowler]

... I think that the dollar will still be able to stay high enough for a long time, because the U.S. economy is quite mobile and adapts quickly enough in the new environment....

I don't share your optimism.
I assume by "still stay high enough", you are referring to the USD position as the world reserve currency.

If so, I do not think it will be a long time.
The '00 & '08 crises were never resolved... instead the FED blew up it's balance sheet.
They essentially kicked the can down the road, and we have now caught up with the can again.
If '08 was "blowing up the balance sheet" of the FED... I don't know what to call this! lol

The can has been kicked again, but I personally don't know how far it's gone down the road.
I am massively confidant that it wasn't kicked any further than 2025-27 - when the Retirement Crisis comes and kicks down our doors.

We have not yet seen this crisis in all it's glory.
We had a recession coming anyway, but then the virus sped that up.
People have gotten used to the virus and think we are over it, but people are confusing the virus as being the real problem.
Unemployment is at very high levels... Debt is astronomically high... credit is extremely hard to come by.
The world is built on credit!

The stock market is rising, which is giving people the impression that things are recovering.
But in fact, it's worsening!
A large part of the index is made up of about 5 tech companies which did well during this crisis.
Then you have the FED buying all sorts of bonds too - this was unprecedented and cannot last.

Economically speaking, the worst is yet to come.

China has become a real powerhouse, and it ironically supplies the US with much of it's purchases (including meds)
There is no way back for the US... the best they can hope for is to survive another day... to recover and rebuild - just like China did when it fell from grace a long time ago.

Also worth noting is the amount of gold that Russia has been accumulating
They fell into the abyss a while back, but they have been quitely building themselves back up too.

Big changes are coming in the next few economic cycles