Excellent point regarding the comparison to investors fleeing the British pound to the dollar in 1956. Yes, the dollar is still the most attractive currency in the world; you don't hear of Argentines keeping hard euros in their homes.
There's cryptocurrency which is already a recognized asset class. Bitcoin seems to slowly be moving towards a pseudo-global-reserve status with nations moving to it when pressed by economic conditions as we're seeing in S. America.
Japan's debt/GDP ratio is currently 260%. And they're not even a global reserve currency. Portugal and Singapore (small countries but very nice places to live) are in the 130's.
Considering these data points, it is likely the US could go considerably further into debt before facing any serious blowback. That doesn't mean it would be a good idea, and I have several foreign currency denominated bank accounts just in case I'm wrong, but predicting imminent collapse (either economic or political) for the United States seems foolish at this point. As Adam Smith said, "there's a lot of ruin in a nation", an axiom doubly applicable to the world's only superpower. As a side note, Smith would likely be amazed at his country's claiming of that position and appalled at what we've done with it.
Brands' latest article is interesting, even though I understand modern economics about as well as I do nuclear physics. I've had one economics course in my life, and that was in high school back in the late fifties. The only thing I recall from it was my teacher saying that the national debt isn't a true debt since we owe it to ourselves. In retrospect, that doesn't make sense since countries borrow from each other. Maybe I should go back to college and take classes in elementary economics and nuclear physics. LOL
Excellent point regarding the comparison to investors fleeing the British pound to the dollar in 1956. Yes, the dollar is still the most attractive currency in the world; you don't hear of Argentines keeping hard euros in their homes.
There's cryptocurrency which is already a recognized asset class. Bitcoin seems to slowly be moving towards a pseudo-global-reserve status with nations moving to it when pressed by economic conditions as we're seeing in S. America.
Japan's debt/GDP ratio is currently 260%. And they're not even a global reserve currency. Portugal and Singapore (small countries but very nice places to live) are in the 130's.
Considering these data points, it is likely the US could go considerably further into debt before facing any serious blowback. That doesn't mean it would be a good idea, and I have several foreign currency denominated bank accounts just in case I'm wrong, but predicting imminent collapse (either economic or political) for the United States seems foolish at this point. As Adam Smith said, "there's a lot of ruin in a nation", an axiom doubly applicable to the world's only superpower. As a side note, Smith would likely be amazed at his country's claiming of that position and appalled at what we've done with it.
Brands' latest article is interesting, even though I understand modern economics about as well as I do nuclear physics. I've had one economics course in my life, and that was in high school back in the late fifties. The only thing I recall from it was my teacher saying that the national debt isn't a true debt since we owe it to ourselves. In retrospect, that doesn't make sense since countries borrow from each other. Maybe I should go back to college and take classes in elementary economics and nuclear physics. LOL