Is the the USD doomed as a world reserve currency?
The United States has benefited enormously from being the Worlds Reserve Currency because much of the world still uses the dollar for international trade. This is because foreign governments must hold in their foreign exchange reserves USD’s to settle international claims and intervene in foreign exchange markets. In addition to that many emerging market countries like Argentina, Uruguay, Paraguay and Peru use USD dollars for capital goods. ie housing, commercial property, imported cars, commodities…
💰 Should Investors worry about Argentina’s Dollar Crisis?
The late MIT economist Rüdiger Dornbusch used to tell his students in the 1980s that there are four kinds of countries: rich, poor, Japan, and Argentina. No one frets anymore about Japan buying its way to world domination. But the world is worrying again about Argentina. The country has just suffered another textbook attack on its currency. On April 24, the yield on ten-year US Treasury bonds broke 3% for the first time since 2014. On the same day, investors began dumping Argentine pesos and seeking the security…
