I've been worrying about the economic ramifications of the dollar losing world reserve currency status. To a certain extent, it is happening, but because there isn't a replacement currency, most countries are just agreeing to do trade in their respective currencies. This article mentions what the likely response will be and I think its prediction is likely, at least in the near term.

I country A and B decide to do trade. Country A sells $100 billion in gods to Country B. Country B sells $90 billion in goods to Country A. They will do $90 billion in their national currencies, but the balance of $10 billion will still be done in dollars because that can be easily used in any nation. This makes sense to me.

It still sends a lot of dollars back to the US to cause inflation and it still reduces the US government's ability to finance its debt, causing increased interest rates and possibly the inability to finance its debt at all. (Although the Fed is likely to print money and buy the debt, but that will just cause more inflation).

#grownostr #dedollarization