Most readers will be familiar with the regular news items about strong central bank buying of gold, as well as the steady stream of articles predicting a move away from the dollar as the world reserve currency.
When we in America buy stuff from foreigners, we pay in dollars if they want to have access to sell in our market. We won’t pay in their currency in our market. We simply won’t buy from them if they demand that. The foreigner then has to do something with their dollars. They can buy bonds, stocks, gold, oil, or something we manufacture, or bury the dollars in their backyard. But they are kind of stuck. Their economy is based on manufacturing stuff for export to sell that we pay for in dollars. The biggest exporter to us still doesn’t have a mature domestic economy to buy all of their stuff and doesn’t yet have other markets to replace ours with their manufactured stuff. To keep their economy going they still have to keep their factories running and make stuff to export. It’s like an unhappy marriage at this point. We are stuck with each other for a while and we will continue to fight and bicker until some point in the future. But not this year or anytime soon. I’m not saying that we can abuse our dollar reserve status in perpetuity, but the can kicking and merry go round will continue for some time to come. We will go bankrupt gradually, then all at once.
Gold replace the $?. The €? Yen? Try buying a Big Mac at a drive-thru window with gold. Try paying your taxes with gold. Try pretty much anything, including Bitcoin. Have to exchange it for $ first. Gold only matters at the government level, and even then it's limited in importance…
The Chinese are buying gold - a relic relied on by the ancients for thousands of years? Why not Bitcoin? What could be safer than a newly minted Bitcoin, backed by the CPU cycles and electricity to mine it?
When we in America buy stuff from foreigners, we pay in dollars if they want to have access to sell in our market. We won’t pay in their currency in our market. We simply won’t buy from them if they demand that. The foreigner then has to do something with their dollars. They can buy bonds, stocks, gold, oil, or something we manufacture, or bury the dollars in their backyard. But they are kind of stuck. Their economy is based on manufacturing stuff for export to sell that we pay for in dollars. The biggest exporter to us still doesn’t have a mature domestic economy to buy all of their stuff and doesn’t yet have other markets to replace ours with their manufactured stuff. To keep their economy going they still have to keep their factories running and make stuff to export. It’s like an unhappy marriage at this point. We are stuck with each other for a while and we will continue to fight and bicker until some point in the future. But not this year or anytime soon. I’m not saying that we can abuse our dollar reserve status in perpetuity, but the can kicking and merry go round will continue for some time to come. We will go bankrupt gradually, then all at once.
re: hacker ......... all the while a couple of terrorists were planning to kill American citizens in NOLA & Vegas
Gold replace the $?. The €? Yen? Try buying a Big Mac at a drive-thru window with gold. Try paying your taxes with gold. Try pretty much anything, including Bitcoin. Have to exchange it for $ first. Gold only matters at the government level, and even then it's limited in importance…
The Chinese are buying gold - a relic relied on by the ancients for thousands of years? Why not Bitcoin? What could be safer than a newly minted Bitcoin, backed by the CPU cycles and electricity to mine it?