Hey, Mr. Trump
May 4, 2025In yesterday’s world, the dominance of the dollar amounted to a Faustian dilemma: the United States could indeed finance itself cheaply, but at the cost of dependence on foreign entities, ultimately leading to its decline. A traditional definition of a reserve currency is that the country issuing it must run a balance of payments deficit.…
Make the Fed GREAT AGAIN!
April 21, 2025Unhappy with Jerome Powell, Chairman of the U.S. Federal Reserve, for not complying with his demands to lower interest rates, President Donald Trump is seeking legal ways to dismiss him. Trump believes it is necessary to ease U.S. monetary policy to offset the economic impact of his tariff policy. His attacks on Powell have now…
An exorbitant privilege — and a persistent one
April 17, 2025Asking what the world would look like without the USD as the unquestioned world reserve currency across finance and trade is a bit like asking a fish what the world would be like without water. There isn’t an obvious alternative to the dollar. There are a range of currencies that investors could diversify into,…
Trump: The Organization of Chaos
March 23, 2025Without explicitly stating it, Donald Trump draws a correlation between the undeniable reserve currency status of the dollar and its impact on the industrial competitiveness of the United States. In truth, the facts support his argument, as industrial jobs now account for only 10% of employment in the U.S., compared to 40% in the 1980s.…
The beginning of the end, or the end of the beginning?
May 29, 2024A trade deficit must be offset by financial inflows to maintain a minimum level of equilibrium. The United States runs a significant and constant trade deficit, which they manage to finance through the sale of Treasury bonds, bought by China and other governments/central banks. The deal is as follows and is an integral part of…
Superower …
December 3, 2022Europe will never manage to impose itself whit a currency that barely accounts for 30% in world trade and transactions, when the $, on the other hand, crushes the whole of the top of its 88%! Europe may struggle, but the extraterritoriality of US law is here to stay.
America’s superpower
October 6, 2022The Dollar is becoming scarce, because the whole world wants and lacks it. This problem – recurring since the 1960s – of scarcity of the American currency constitutes an incredible headache for the countries indebted in this currency when the latter is brought to appreciate because their debts and their interests become more expensive…
$: the lord almighty, our master
November 28, 202115th August 1971: surely the most important date of the 20th century for economics and finance, the day that marked the decision of US President Nixon to unpeg the dollar from gold. Taken on a Sunday evening, before the opening of the markets, it introduced a new era: that of a currency underpinned solely…
The Saudi/US pact: reflection of a vulnerable America
February 17, 2020The US is made a distant comeback. Its dollar was, at the start of the 1970s, in a precarious situation due to the exorbitant cost of the Vietnam war and the various social programmes whose combined effects meant the country could no longer maintain the parity with gold that was established in 1944 at…
A precarious euro in a Europe with no ambition
November 8, 2018The dollar has been an integral part of America’s foreign policy for decades. Much more than the currency of reference for global trade, greatly surpassing the privileged status of reserve currency for the central banks, the Greenback is the supreme arbiter. With the simple press of a button, the US can refuse access for any…