Dedollarization is not primarily a story about exchange rates or trade efficiency. It is a story about the fiscal foundations of American military spending.
https://x.com/nxt888/status/2091977093383172359
People misunderstand what reserve currency status actually buys.
It isn't just prestige.
It is the ability to run deficits that no other country could sustain without a crisis.
Because the world needs dollars to trade, the world buys dollar-denominated assets, treasury bonds, to hold those dollars.
This means the United States can borrow at lower rates than any other country.
Can spend more on its military than the next six countries combined without triggering the kind of inflation or currency collapse that would destroy any other economy doing the same thing.
Can, in short, maintain imperial reach at a cost its own economy could not otherwise support.
Dedollarization is not primarily a story about exchange rates or trade efficiency.
It is a story about the fiscal foundations of American military spending.
If the world stops automatically absorbing US debt, interest rates rise, borrowing costs increase, and the question of how to fund 800 overseas bases becomes suddenly, urgently, domestically political in a way it has not been since Bretton Woods.
That is the real stake.
Not the yuan versus the dollar.
The question of whether American power is as affordable as it has appeared.
posted by Satish Sharma at
02:25
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