It doesn’t really make sense for countries or unions (e.g. EU) to decide to base their trade of the USD and keep a lot of their foreign reserves as the USD if it isn’t backed by gold. Wouldn’t this just mean that a lot political power is given to the US because they have the ability to arbitrarily set the value of trading currency if it isn’t based of a real-world resource like gold ?
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USD is, like almost all other currencies in the world, a fiat currency. It is valuable because it can be traded for other things of value, by decree of the government. If you look on a US dollar bill you will see the phrase ‘This note is legal tender for all debts, public and private”. This means that if you owe a debt to someone you can satisfy it in the eyes of the US government by paying US dollars. That speaks to the core of why fiat currencies are valuable.
It is also nonsense to think that gold is somehow intrinsically valuable in any meaningful way. If you had a pound of gold what use would that be to you? Only that you could trade it for something else of value, exactly like a fiat currency.
The US doesn’t just “decide” how much the USD is valued at in trading. That is determined by the free market, by how much people are willing to trade in exchange for USD. Many people want USD because it is a very stable currency, a reliable store of value, and many places in the world desire to obtain it in trade. If you pay someone in USD they will probably be happy because they want other things from people who will also accept USD. The United States is so influential on the global economic stage that the USD is used as the global reserve currency. Most oil trade is also performed in USD which feeds the desire for USD.
All that does give the United States a lot of political influence, but it wouldn’t be aided by being backed by gold. In fact it would make it weaker as someone finding a bunch of gold could crash the value of everyone’s reserved dollars!
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