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While again, I don't disagree with any of that, I think we need to be realistic. US workers get paid far and away more than Chinese workers. If all else was equal, a US produced product will always cost more than Chinese.
whereas the us dollar is valued by supply and demand
The volume of business transactions in crude oil trade is not something minimal, it's massive. As crude is denominated in terms of US$, most of these transactions are settled in US$ giving US$ an undue advantage and make US$ very important and powerful. US$ is de facto the reserve currency of the world.
One of the major reasons that supports its reserve currency status is this. But, what is truly backing US$? What are its fundamentals? It's not unknown to the people on this planet that the US$ bills are printed on thin air. The external debt of US was $17.5 Trillion per wiki facts dated Dec 31, 2015 i.e. $58,255 per capita.
The unofficial estimate crosses $66 trillions. Barack Obama himself in his tenure crossed the external debt that his 10 predecessors could create. That's a record. In simpler terms, you are tossing a bill outside the borders and buying products and services for that paper (the paper may be even worth more than its quoted price, for real). What will happen is a big question but not so difficult to answer.
We've seen Saddam Hussein's fate who wanted to settle his crude bills in EUR or Gold. The military might of US is not unknown to anybody. Now, it's anybody's easy guess.
All money is fiat currency. This is not unique to the dollar.
originally posted by: Isurrender73
a reply to: TheConstruKctionofLight
Floating Exchange rates should take care of most of this advantage you speak of, if the system is working properly. Some nations rig the system, but overall the exchange rate determines the value of the dollar.
All money is fiat currency. This is not unique to the dollar. Our dollar is worth less because we have to print so much. If the system is so great for the US why are other currencies valued higher than the dollar?
You are lucky that the world realizes this would be bad for us all and allows you to keep your advantage.
originally posted by: TheRedneck
a reply to: nightbringr
You are lucky that the world realizes this would be bad for us all and allows you to keep your advantage.
Is it your opinion that this is part of the reason we have been able to maintain the Petrodollar status as long as we have?
TheRedneck
originally posted by: nightbringr
a reply to: Isurrender73
Oh, preaching to the choir, my friend.
In Canada I belong to a lobby group that among other things, petitions the government to not run deficit budgets during times of financial growth.
However, your current POTUS is still deficit spending.................
originally posted by: Isurrender73
originally posted by: nightbringr
a reply to: Isurrender73
Oh, preaching to the choir, my friend.
In Canada I belong to a lobby group that among other things, petitions the government to not run deficit budgets during times of financial growth.
However, your current POTUS is still deficit spending.................
Yes he is. But interest on 20 trillion makes it hard. I don't really have the answer. Exept to tell the bankers to shove it. The world is at least 250 Trillion in debt to bankers who loan out electric currency they don't actually posses. I think a debt jubilee is in order for the whole planet as only an act of God can change this messed up financial system.
I think that's why the globalist puppets put us into such a debt burden to begin with. I believe there was a design in place to collapse the US and sell it to the highest bidder. I can not fathom any other reason for allowing such insane amount of debt to be placed on the US citizens.