Eli5: Why is the U.S. Dollar so powerful?
In: 208
Simple version:Oil was based on it & twas used to stabilize other currencies…
You needed US dollar to fuel your country…now you need gold backed ruble..
Oil.
from: https://www.investopedia.com/articles/forex/092415/oil-currencies-understanding-their-correlation.asp
Oil Quoted in Dollars
Crude oil is quoted in U.S. dollars (USD). Countries that import oil pay for it in the greenback. Similarly, those that export the commodity receive payment in USD. This system dates back to the early 1970s after the collapse of the Bretton Woods gold standard. This period saw the rise of the petrodollar system, which promoted the U.S. dollar’s rise as the world’s reserve currency. Oil producers and purchasers use this system to trade in the commodity in U.S. dollars.
https://podcasts.apple.com/ca/podcast/planet-money/id290783428?i=1000553500393 planet money did a podcast on how the US dollar became so powerful in the world economy
Planet Money (NPR) Ep. 1517 is a quick and interesting listen for why other currencies are pegged to the USD. Lots of subjective language in global lending contracts that – purposefully – favored the USD.
Because we have 10 aircraft carriers, 13000 military aircraft, 6000 tanks, and 5000 nuclear warheads
Imagine a bomb so powerful it could destroy whole cities. America used that
bomb twice and then with the world so terrified it kind of reminds the world it would do it again. So then basically everyone needs to agree with the bully. Russia is trying this out right now though they’ve never had the heart to actually use it yet.
Because we don’t even need to fight a world power to win, we just gotta give someone else our shit to fight with.
Don’t think the dollar is worth as much as we say it is? Well…Why don’t we reconvene this convo after we toss a few javelins and tomahawks at you.
This is a great Planet Money podcast that explains how the US Dollar solidified it’s place as the global currency https://www.npr.org/sections/money/2017/04/28/526051566/episode-553-the-dollar-at-the-center-of-the-world
Aside from the 1860s, we’ve never had a civil war. Our government has never collapsed.
Europe blew itself up twice.
Americans largely believe in free markets. We’re not going to have radical change, especially not a socialist revolution.
The US usually goes to war with any country that tries to compete with the US Dollar.
IMF usually lends (bribes) a certain political group in whichever country that could possibly compete with the US Dollar to implement the US backed Monetary system to squash any uprising before it happens. Recent failed attempt would have been the 2019 Venezuela uprising with Guaido.
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