The Triffin Dilemma / Reserve Currency Paradox

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posted on Sep, 11 2012 @ 07:42 AM
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The Triffin dilemma (or the Triffin paradox) is a theory that when a national currency also serves as an international reserve currency, there could be conflicts of interest between short-term domestic and long-term international economic objectives. This dilemma was first identified by Belgian-American economist Robert Triffin in the 1960s, who pointed out that the country whose currency foreign nations wish to hold (the global reserve currency) must be willing to supply the world with an extra supply of its currency to fulfill world demand for this 'reserve' currency (foreign exchange reserves) and thus cause a trade deficit.

The use of a national currency (i.e. the U.S. dollar) as global reserve currency leads to a tension between national monetary policy and global monetary policy. This is reflected in fundamental imbalances in the balance of payments, specifically the current account: some goals require an overall flow of dollars out of the United States, while others require an overall flow of dollars in to the United States. Net currency inflows and outflows cannot both happen at once.

The Triffin dilemma is usually used to articulate the problems with the U.S. dollar's role as the reserve currency under the Bretton Woods system, or more generally of using any national currency as an international reserve currency.

en.wikipedia.org...

I dont think many people stop to think how insane it is to allow the United States to maintain the Reserve Currency. The world should have never allowed this to happen at the end of WW2.

And who the hell is still buying US treasuries? The media tells us they get a bump here and there on bad news that the 'news' spins into a positive. Example- bad job figures, USD gets a bump because people expect stimulus. hmm. USD gets a bump because of bad news out of Europe. hmm I say bs. BS! Day traders are not that stupid. The US Government is buying their own bonds. Its akin to Insider Trading if you ask me. And they already raided the American peoples pensions. Are they just printing the money? They know how to print money is for sure. I say they print USD to buy USD to keep the USD looking like its still standing. ( I know they buy them on record but Im saying that they buy them through a third party/off record also ) Who knows what these criminals and their media are doing? If they can steal a trillion dollars just before 911 then what are they stealing now? How much truth is in their figures?

This is bs. The United States has forced us all to use the USD in all international purchases since WW2. We were all too scared to do anything about it. Now everyone is just ignoring America because they have become pathetic so why dont all the nations sit down and work out a solution? The American people will be better off if we help them now instead of when they drop of their fiscal cliff.

The American people dont even know how evil ther government is. Most Americans are not aware that their Government has used the Reserve Status as their own personal credit card since WW2. Most American are not aware how close their nation has come to complete collapse.

The matter of the Reserve Currency is urgent. If the world continues to move to a 'Basket Reserve' with no regard for America then the American people will suffer. An orderly transition needs to become a priority so the world can do what it can to limit the suffering of the American people. We need a solution for the sake of the American people but also for the sake of the world economy. The United States collapsed the world economy already. Why should we allow them to do it again?
edit on 11-9-2012 by freemarketsocialist because: (no reason given)
edit on 11-9-2012 by freemarketsocialist because: (no reason given)




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