I think I get what you are saying here.  Sure, most of the time things are priced in USD.  Like EuroDolalr or YenDollar or whatever.  But people can just as easily talk about the EuroYen instead of the DollarYen when quoting prices.  This new country that just prints $ would see its FX decline in relation to all currencies, not just the USD.  Even BTC is quoted in dollars often but can also be quoted in EUR or whatever.  The reason that the USD is in control, as you say, is because well if I work in Indonesia or whatever and someone wants to pay me, I would much rather trust the USA than Vietnam or whatever so I would much rather you paid me in USD.  That's just because that country has good things going for it, there is nothing wrong with being preferred currency if that is the case.

I just don't agree that "we" set the price of these other things you reference.  The USD is not set by any one party.  Sure, the Fed has a lot of control over it because they control short-term interest rates, but there are so many other global factors that affect the value of the dollar that it is difficult for me to accept that our government controls it.  And even if they do - I just don't think it matters.  It only matters if you are doing business with the US, in which case other countries WANT our FX to be weaker so that they can sell us more stuff!  But in the long run it is inflation that affects the strength of a currency and this government has done a good job of keeping that in check.

Creating money out of nothing IS a good thing if that money is being used to invest in productive assets.  If a country prints its way into a fortune and has no economy, it is worthless.  But if a country prints a fortune and create unlimited, no-pollution portable power source or something crazy, that currency will be worth a lot.  It just depends.  And I think in this case the USD is doing well - they have the best tech industry, the best healthcare industry and a slew of other things going for them.  Sure, it could change tomorrow but that is speculation.  And having that argument is much different than saying the USD will be worth $0 in 100 years because it's much harder to think it through and say I think the US won't be competitive because of X or Y.  Those points can be argued but saying that it's screwed, well that's just an opinion.

And yet there's Bitcoin

The US cannot just spend those reserves on things like oil.. they literally sit on the bank's balance sheet as an accounting journal entry.  They cannot use it to buy oil or anything else.  You see, the dollars never make it to the economy UNLESS they are borrowed by people.  The only way you can say QE is inflationary is if you think banks DID NOT HAVE ENOUGH RESERVES TO LEND BEFORE and this "new" QE money allows them to lend and that causes inflation.  BUT, critically, the banks NEVER had a problem with having reserves before!  In fact, banks don't actually need reserves to lend - they lend FIRST then create the reserves as an offset on their books!  This is so important.  If you understand that you understand that QE is just an asset for asset swap which nets to 0 - swap reserves for US Treasurys - cash for cash - a checking account for a savings account!!  So many people got this wrong since 2009, please understand how important it is.

I know they sit on a balance sheet! That's my point, they don't exist! This is how the US can mitigate inflation. They buy oil shares with money they doesn't exist! They when the oil shares are sold for profit, money comes into the US economy they never existed before. What this does is allows the US to increase its economic activity without having to print money for banks to lend to citizens (QE = this option equates to inflation).

That is the problem: Banks do not need reserves to lend! Debt is only an asset to the dispensers of that debt. Banks that originally started in the US never had their own money, they were public businesses that lent money loaned to them from the Fed to the citizens of the US.

I understand how important this. It's one of the single largest reasons that US capitalism is killing itself. When citizens/businesses/institutions fail to pay back their debts to banks, few if any banks truly go under. What happens is they bundle all that debt, refinance the it, sell it parted out to other banks and lenders, and file some nice documents to get the Fed to stimulate the economy again with newly printed dollars they can lend.

All money in the US economy since its 'humble' beginnings in 1776 are debt. Money cannot be created out of nothing.



1 - no professional investor or businessman trusts data that comes out of China.  They make up numbers and hide problems.  Of course they are a huge economy that will continue to grow, the issue is that people do not trust their government to put all their cash in CNY.  Their legal system is nowhere near the USA, which is why China is nowhere near ready to be reserve status.
2 - Europe - lol - dude they've been saying that every year for the last half decade!  Those are just projections!  Greece is ready to leave and the structural problems that Europe has cannot be fixed without full fiscal and monetary integration of their banking system - something the Germans are wildly opposed to.
3 - Britain's currency being devalued is good for their economy.. they can sell more of their goods.  It is only bad for people who want to take vacations, because they have to spend more.  That is anything but a collapse.
4 - Dude, China was one of the first to ban BTC transactions..
5 - You are speculating, wildly.  Interest expense is down as a % of total government outlays because rates have fallen.  And again, the way our country works we can use the Treasury and primary dealers to buy US debt - we don't need outside forces to do this.  You are saying that people will pay fewer taxes in the future - why?  The US economy collapses?  I think not.  Because interest expense will be high?  No - we can control this by issuing shorter debt maturities, and besides rates have been PLUNGING for the last 30 years, so that part of your argument is also false.
6 - Dude having best legal system is what makes people want to do business with us and supports reserve currency status, which you seem to think is so important.  That is why I mentioned it.
7 - I'm not sure what this is referencing.
And BAS please understand that when I read your comments it is very clear you do not know what you are talking about so don't tell me I am a bank teller.  If you are delusional enough to not see that what I am saying is based on FACTS and what you are saying is based on speculation, things you read online and general surfacy BS then please, move on.  Quoting things like European estimates is just obviously clear that you are naive about many topics.  Every economist every Wall Street analyst 99% of the time predicts things to get better and follow a trend.  If you look at what actually happens and how often they are right, you will see that stuff like that is not worth a lick.  We all know the world is more global than the US, I'm trying to address everything that I can and I am not implying that the world is not connected globally.

It's actually not a problem at all.  Those countries have their own agendas and reasons for doing deals which are political in nature.  China and Russia doing deals on the side means nothing when the rest of the world is not following suit.  If you want to see if people believe in the ability of the US to tax, look at the USD at ten year highs, look at US Treasury yields approaching multi-decade lows.. your assertion that people are losing faith is based on no facts, you are ignoring all the evidence to the contrary.  Let's just say you are right and the US loses it's status.. who is it going to go to?  China with their fabricated economy that no one has faith in?  Or Europe which is teetering on collapse?  There is no one else.  Full stop.  Period.  Besides even if it does happen, that is not a kiss of death.  Great Britain was just fine after they lost reserve status, their economy did not collapse and the world kept spinning.  I'll tell you one thing, it sure as heck won't be Russia or Brazil or China accepting BTC for their goods and services.

Let's step back and ignore what the market is telling you and also put aside our theories for a second and think:  why on Earth would the US all of a sudden not be able to tax its citizens and pay interest on its debt?  That is the fundamental question.  We have a powerful military to protect us, we have one of the best economies in the world and we have the best legal system in the world.  There are no rational or logical reasons to think that the US is on the decline or the dollar is doomed or anything close to that.  And looking at interest rates and FX strength you can see the world does agree with that statement.

Oh boy. Where do I start!?

1. Depends which side you are on.
2. What is "global deleveraging" if not the rapid deflation of debt.

Specifically:

Fisher's formulation
In Fisher's formulation of debt deflation, when the debt bubble bursts the following sequence of events occurs:

Assuming, accordingly, that, at some point in time, a state of over-indebtedness exists, this will tend to lead to liquidation, through the alarm either of debtors or creditors or both. Then we may deduce the following chain of consequences in nine links:

Debt liquidation leads to distress selling and to
Contraction of deposit currency, as bank loans are paid off, and to a slowing down of velocity of circulation. This contraction of deposits and of their velocity, precipitated by distress selling, causes
A fall in the level of prices, in other words, a swelling of the dollar. Assuming, as above stated, that this fall of prices is not interfered with by reflation or otherwise, there must be
A still greater fall in the net worths of business, precipitating bankruptcies and
A like fall in profits, which in a "capitalistic," that is, a private-profit society, leads the concerns which are running at a loss to make
A reduction in output, in trade and in employment of labor. These losses, bankruptcies and unemployment, lead to
pessimism and loss of confidence, which in turn lead to
Hoarding and slowing down still more the velocity of circulation.
The above eight changes cause
Complicated disturbances in the rates of interest, in particular, a fall in the nominal, or money, rates and a rise in the real, or commodity, rates of interest.
—(Fisher 1933)

The US does not need oil to be priced in USD to "print money".  This is a fundamental misunderstanding of the way our monetary system works.  It is not something that can be argued because it is a fact like 1+1=2.  The Federal Reserve can create reserves out of thin air.  This is what people call "printing money".  But it is not actually money printed into our economy as you say.  The banks have to lend in order for new money to be created outside of the federal reserve system.  Banks only lend if qualified borrowers want to borrow.  This is why we have not had inflation despite the Fed "printing" trillions of dollars over the last few years.  The reserve simply sit on the banks balance sheets, there is no mechanism to turn them into cash besides market forces like demand.

Why would the US not be trying to ramp up manufacturing now, and instead waiting for some event?  They are manufacturing more today.  Every individual company tries to maximize profits, there is not one God of USA that says hey, we should all do manufacturing real good now.  It's thousands of companies that work independently in the economy to make a buck.

I'm afraid I do not know the rest.  What I do know is that you are talking about getting rid of volatility with BTC which is down 70% in a year.  That makes no sense.  Look at a chart of the USD over the last ten years and compare it to BTC - which would you rather hold your $ in if you are looking for stability and not wild speculation?  You have ideas about FX and the USD but they are not based on facts and are non sequitur.

1. Bitcoin has to show that it is the dominant crypto platform with a long staying power. However to prove that, it needs large scale buy and hold from wall street, resulting in catch 22 situation.
2. If you look at one of Peter Thiel's videos (https://www.youtube.com/watch?v=RUMgK0TyV1Q), he talks about supporting monopolies. Bitcoin is an open system, hence no monopoly is likely which we should be happy about.
3. Wall street understands companies, even companies with platforms (Apple, Google, Microsoft, facebook, etc). They do not understand or invest vast sums into platforms that are not associated with one dominant company. Example-Linux and now bitcoin.
4. Cons of bitcoin (from the wall street perspective): bitcoin does not have a single charismatic leader that Wall Street comes to trust (a la Gates, Jobs, Besos, Zuckerberg, Page/Brin).

Conclusion: Wall street will try to build up and promote some crypto 2.0 (ethereum) that is/are associated with certain leaders (Buterin/Wood) or an alternative 1.0 (XRP). We'll see if that works.

Bitcoin has to survive and thrive WITHOUT wall street, as was originally intended.