America was in practice running an empire that collected tribute from the rest of planet earth in exchange for entries in a database denominated in a currency they controlled and that was accepted everywhere. Really the only way it could go wrong is putting it under the control of someone who doesn't understand the kayfabe...
Being a reserve currency puts a gun to your economy's head. It creates an asymmetry where domestic production of material goods has to jump a gap created by favorable exchange rates in PPP terms. Its great for the day to day life style of your citizens, as other economy's do indeed pay tribute, in a sense, to their consumption of goods produced overseas. However, being paid to do nothing becomes a real problem when the checks stop coming. We're basically the national equivalent of a middle manager who's forgotten all the skills that got him there, and we can voluntarily move back down and start to work in earnest again, or wait to get laid off with no severance.
As someone who lives a day to day life, I’m pretty happy for things that are good for my day to day life. Some abstract quasi moralistic reason that things should be tougher so we compete harder feels a little out of touch. I’d note that it’s not the case the US produces nothing, or that it’s lost its capacity to innovate. Effectively most technology, especially software, but hardware as well, is concentrated in the US. Some aspects of the heavy manufacturing and assembly line happens elsewhere but I’d level the middle manager more at the EU.
No, we are taking our advantages and lighting them on fire for no obvious reason. Backing into a rationale doesn’t make it rational. Its Christian nationalism fueling raging narcissism made malignant due to senility. Theres no experts, no adults, no experienced people - they’ve all be fired and replaced with sycophantic photogenic personalities. This is not good, there is no upside, it’s Nero hosting UFC while the empire burns.
The only out I see is nature helping end this or a total seismic change in Congress and removal from office. Then rebuilding can start and maybe there’s something to salvage. But I doubt it, and I expect the next generations will exist in the rubble of the colosseum.
The fact that he has done countless things that are harmful to the US and not a single thing that is in the country's best interests tells me all I need to know. Either he's aligned with an enemy or he just hates the country and wants to destroy it.
I disagree with probably the majority of Trump's main policy ideas, but I think a strong case can be made that his immigration policies are in the country's best interests. Not all of them, but as a whole.
> More importantly, in the context of this discussion, every president since Bush's first term has had larger deficits than any previous president, regardless of party.
Taking on long term debt at or below the risk free rate _is the point._ It didn't devalue the currency because the global economy was structured around buying that debt. You just need to not jeopardize that second point.
The events of the last year certainly have a role to play, but the overall effect is just the result of trendlines that have been in play for quite a while.
> Gold has always been stable, because it is physically limited.
Incorrect. Physical scarcity matters, but it’s not the main driver. Gold’s price is far more sensitive to interest rates, dollar strength, sentiment and fear, speculative flows.
The stability it’s historically shown was mostly the result of fixed monetary systems, and those are long gone.
its because you are measuring stable Gold in volatile fiat which is being printed every day depending on the factors you mentioned (interest rates, expectations of future growth, sentiment etc).
because you are getting paycheck in fiat, you are psychologically programmed to think of fiat as something stable, and Gold as volatile.
You're wrong; the prices of precious metals have never been stable, which is why bimetallic systems have always had a lot of problems papering over the notionally fixed exchange rate between coins of different metals.
That said, I agree that e.g. gold under a regime where most things for sale are priced in gold is more stable than gold as a novelty investment under a fiat currency regime.
When things are priced in gold, most of the demand for gold comes from the fact that it's useful as currency. All of the phenomena we have now still exist, and they disturb the price, but they're small effects compared to the demand for currency.
In the fiat regime, that source of demand is gone. All of the same random effects still push the price of gold around, but because the price is so much lower (due to much lower demand), the price swings are wilder.
The real price of gold has been deflated by paper gold/futures trading, which has the effect of multiplying the perceived amount of gold in circulation without a necessary counterpart in physical gold. Financial institutions can within limits manipulate the price of gold so that it remains lower than it should be if the physical material had to be delivered.
You're seeing the result of something that's been decades in the making. You can see a simple table of dollar reserves here. [1] They've been consistently falling year over year for the past 27 years. And it's not like 1999 was anything particular. Rather the uptake leading up to 1999 as a peak was a result of shenanigans that happened in 1971 [2]. That's when the USD became completely unbacked by anything, enabling the government to start going arbitrarily far into debt. That had short to mid-term positive impacts and long-term catastrophic ones, as is the typical strategy in modern times.
People always exaggerate the impact of geopolitical things, because it feels like the biggest thing ever, especially when you're relatively young. But in reality we're always onto nonsense after nonsense. Countries have the wisdom and view to appreciate this, and so respond to geopolitical stuff (in action, not rhetoric) far more gradually than people do. They're certainly not going to just dump all their dollar reserves because of a single misguided war or even misguided president, or they'd have been gone long ago.
I hear you, the world is always ending. But, I am well past mid-life, I am a huge beneficiary of Pax Americana, and 47 feels like something truly different. Maybe it's just the end of a long pattern, but it is still the end. US-led NATO is dead, and the stability of the USA is dead, therefore the dollar's dominance is weakening.
Don't take my word for it. Listen to Mark Carney at Davos.
I think there is a realization that (1) US' checks and balances do not work, (2) Trump is not a "mistake" of voters and can repeat again.
This is the main reason that things are different. Most presidents were reasonable in their hegemony, and Trump's naked aggression makes everyone to hedge against US.
How can you reconcile the rest of your comment with:
> That had short to mid-term positive impacts and long-term catastrophic ones, as is the typical strategy in modern times.
Is the catastrophe still coming from the 70s to now? 50 years later? This is the most repeated quip that makes no sense. Same with companies, everyone just repeats "omg they only care about short term" and then years after years the company trots on.
But I guess it's easy to say since the defense is "oh just wait". As if the online commenter is able to see N+1 moves more than whoever they comment about, but that person just simply cannot. Like come on.
It’s not a self decapitation exactly. I think Trump, his family, his corporate donors, and other friends are all willing to sacrifice everyone else - including the lead America had - to make themselves rich and powerful. Every single decision to spend - defense, ICE contracts, AI, approvals of anticompetitive acquisitions, changes to regulations, etc - is making that circle richer at our expense.
They don’t care if American supremacy is lost or if the dollar crashes or if the national debt becomes a crisis. As long as they have their wealth. The public is being decapitated, not them.
True. In that sense the voters have self decapitated. I can’t understand how the Trump administration still has support from 40% of the country (per polls). I could understand voting for him due to some issue a voter has strong feelings about. But now we have seen it all play out and it’s a disaster leading to national ruin. And there is no talk of impeachment, trials, and accountability for everyone in his circle. So I guess that 40% DOES choose to self decapitate.
Media that is never critical towards one side is what started all of this. A politician's kryptonite is when their voters find out that they lied or were hypocrites. That is a universal truth.
Single party media outlets like News Corp, Sinclair, Euronews, and so many others have broken that system entirely.
My test to see if someone is a shill/moron is to simply ask them to say one obvious bad thing about "their side." If they cannot, it becomes clear that they are not worth listening to.
> and all the conservative news tells them what to believe
And most traditional news is conservative now.
The idea that the mainstream media was ever leftest was always wrong, but these days its absolutely laughable and yet a lot of people still parrot this like it is the truth.
The US lead over the EU in per capita productivity has massively grown over the last 20 years. There's no indication of waning American power.
America has produced 70 times more stock market wealth if you look only at companies created within the last 50 years than the EU. And this is not all paper wealth. If you look at technological sophistication, whether that's frontier AI models, leading-edge pharmaceutical drugs, total amount of compute, or the space industry, the U.S. has grown its lead over the EU over the last 50 years.
It's because the EU has largely fixated itself on reducing wealth inequality by punishing those who succeed. It's safety-maximalist approach to private industrial action has also hamstringed industry — see Germany closing all 17 of its nuclear power plants. The US doesn't really need to do much except not sabotage itself to maintain its lead. Like in all nations, laissez-faire (French for "leave it alone") allows the private sector to do the rest.
Weakening your own domain to get powerful sounds clearly contradictory, yet there are so many examples of elites doing exactly that despite the fact that doing so must've required foresight and planning elaborate enough to not blind them from the consequences.
basically make decisions that make no sense but benefit you financially. Sample. you run a printing business. you dont own it just run it. you sell your main printer and assign a performance bonus to your self. next month your business is closed because you dont have equipment to print, but you also have your bonus in pocket.
Not really. It has more to do with gold is now worth almost 3x what it was 2 years ago.
And before you get too excited, this "news" from the World Gold Council. A consortium of gold mining corporations. Clearly it's a pump article "have you bought gold yet? everyone else is! why not you!?!?"
Not really. It has more to do with gold is now worth almost 3x what it was 2 years ago.
It's not like we've suddenly found new and exciting uses for gold though. The reason the price has gone up is because the demand for it has gone up, and the reason why demand has gone up is because people want an alternative to U.S bonds. A bunch of pump articles wouldn't be enough to lead to a 3x price increase.
Too tired to write a novel like I usually would here, but we control the printing and, in large part, the distribution of USD. We don't control anything about gold. Then the USD was king, it entailed tremendous power and control in many ways beyond the obvious like the ability to try to kick people out of the 'global' economy. This is the not-so-secret purpose behind BRICS and dates back to issues starting in 1971.
I am actually convinced that the last year started the descent of the U.S. as the world’s super power. No wonder U.S. treasuries lost trust. It’s only going to get worse. It doesn’t matter what some billionaires do/get from their ability to manipulate some powers be. The rest of the investment community understands that free markets are strengthened by rule of law and adherence to the law and deploying a self styled socialistic distribution of economic capital is not signaling strength but weakness to the world.
That’s interesting. Hadn’t thought of it that way. I can’t for the life of me figure out why more blue states aren’t taxing their wealthy occupants to cover the gap in lost federal funding from DOGE. If they were smart they would start stretching that muscle.
The union of states arrangement has the side effect of putting the states in competition with each other for things like new/expanding businesses and residents. It's relatively easy to relocate (or even remain in a state while legally "residing" elsewhere). So there are diminishing returns to raising the tax rates significantly on the upper brackets at the state level. I'm not a believer in the trickle down theory but beyond a certain marginal rate many people would just move to a state with a lower rate.
this somehow excludes such human concept as sense of belonging. might be in usa it has atrophied already but sense of home is really important in some places. place where you spend most of your life, where you have you real social network, neighbors and childhood friends. sometimes its lower tax is not worth loosing it all. its not everything about money (for some)
ps im talking about real persons here, not corporations
That's only true if he's actually "your guy". There's an alternative where it's not stupidity that I think more people should be mulling over.
No, we are taking our advantages and lighting them on fire for no obvious reason. Backing into a rationale doesn’t make it rational. Its Christian nationalism fueling raging narcissism made malignant due to senility. Theres no experts, no adults, no experienced people - they’ve all be fired and replaced with sycophantic photogenic personalities. This is not good, there is no upside, it’s Nero hosting UFC while the empire burns.
The only out I see is nature helping end this or a total seismic change in Congress and removal from office. Then rebuilding can start and maybe there’s something to salvage. But I doubt it, and I expect the next generations will exist in the rubble of the colosseum.
Taking on long term debt at or below the risk free rate _is the point._ It didn't devalue the currency because the global economy was structured around buying that debt. You just need to not jeopardize that second point.
Here's a world gold council (i know...) review/survey of central banks gold holdings from mid 2025 (https://www.gold.org/goldhub/research/central-bank-gold-rese...). It notes that gold purchases (by mass) have been elevated going back to ~2023.
Gold prices have also been on an upward trajectory ever since 2023 (https://goldprice.org/gold-price-history.html)
Whatever is happening now is bigger than actions over the last year.
It is the fiat currency debasement via unlimited money printing that makes the gold chart go up.
Imagine being in Zimbabwe or Weimar Germany and watching your stock portfolio and gold going up...
Incorrect. Physical scarcity matters, but it’s not the main driver. Gold’s price is far more sensitive to interest rates, dollar strength, sentiment and fear, speculative flows.
The stability it’s historically shown was mostly the result of fixed monetary systems, and those are long gone.
because you are getting paycheck in fiat, you are psychologically programmed to think of fiat as something stable, and Gold as volatile.
while in reality prices expressed in Gold ounces remained fairly stable for example: https://i.redd.it/1b5mfrqkxxef1.jpeg
That said, I agree that e.g. gold under a regime where most things for sale are priced in gold is more stable than gold as a novelty investment under a fiat currency regime.
When things are priced in gold, most of the demand for gold comes from the fact that it's useful as currency. All of the phenomena we have now still exist, and they disturb the price, but they're small effects compared to the demand for currency.
In the fiat regime, that source of demand is gone. All of the same random effects still push the price of gold around, but because the price is so much lower (due to much lower demand), the price swings are wilder.
It's like witnessing a self-decapitation.
People always exaggerate the impact of geopolitical things, because it feels like the biggest thing ever, especially when you're relatively young. But in reality we're always onto nonsense after nonsense. Countries have the wisdom and view to appreciate this, and so respond to geopolitical stuff (in action, not rhetoric) far more gradually than people do. They're certainly not going to just dump all their dollar reserves because of a single misguided war or even misguided president, or they'd have been gone long ago.
[1] - https://en.wikipedia.org/wiki/Reserve_currency#Global_curren...
[2] - https://en.wikipedia.org/wiki/Bretton_Woods_system#Nixon_sho...
[2] - https://wtfhappenedin1971.com/
Don't take my word for it. Listen to Mark Carney at Davos.
This is the main reason that things are different. Most presidents were reasonable in their hegemony, and Trump's naked aggression makes everyone to hedge against US.
> That had short to mid-term positive impacts and long-term catastrophic ones, as is the typical strategy in modern times.
Is the catastrophe still coming from the 70s to now? 50 years later? This is the most repeated quip that makes no sense. Same with companies, everyone just repeats "omg they only care about short term" and then years after years the company trots on.
But I guess it's easy to say since the defense is "oh just wait". As if the online commenter is able to see N+1 moves more than whoever they comment about, but that person just simply cannot. Like come on.
They don’t care if American supremacy is lost or if the dollar crashes or if the national debt becomes a crisis. As long as they have their wealth. The public is being decapitated, not them.
Single party media outlets like News Corp, Sinclair, Euronews, and so many others have broken that system entirely.
My test to see if someone is a shill/moron is to simply ask them to say one obvious bad thing about "their side." If they cannot, it becomes clear that they are not worth listening to.
It turns out that progressives are just as easily fooled as any other group, by a slick turn of phrase. For example, "Genocide Joe."
I once thought my group was more thoughtful. But, it turns out that ALL of us are easily programmed meat machines.
Voted for Obama, he totally messed up with Russia and Crimea.
I could go on, and on. Fallibilism, ftw? Can't be sure :)
And most traditional news is conservative now.
The idea that the mainstream media was ever leftest was always wrong, but these days its absolutely laughable and yet a lot of people still parrot this like it is the truth.
America has produced 70 times more stock market wealth if you look only at companies created within the last 50 years than the EU. And this is not all paper wealth. If you look at technological sophistication, whether that's frontier AI models, leading-edge pharmaceutical drugs, total amount of compute, or the space industry, the U.S. has grown its lead over the EU over the last 50 years.
It's because the EU has largely fixated itself on reducing wealth inequality by punishing those who succeed. It's safety-maximalist approach to private industrial action has also hamstringed industry — see Germany closing all 17 of its nuclear power plants. The US doesn't really need to do much except not sabotage itself to maintain its lead. Like in all nations, laissez-faire (French for "leave it alone") allows the private sector to do the rest.
US voters were so worried that South America would come to them, that they have become the worst of South America.
this is what trump is doing: selling America short
if American political system allows President to do that and allows such President to be elected, than such system deserves to die.
And before you get too excited, this "news" from the World Gold Council. A consortium of gold mining corporations. Clearly it's a pump article "have you bought gold yet? everyone else is! why not you!?!?"
It's not like we've suddenly found new and exciting uses for gold though. The reason the price has gone up is because the demand for it has gone up, and the reason why demand has gone up is because people want an alternative to U.S bonds. A bunch of pump articles wouldn't be enough to lead to a 3x price increase.
Are you saying that the price of gold just spontaneously went up?
From over hear it seems like the age of Pax Americana is over, and gold at ~$4,600 is one of the results.
Ofc those with an incentive of higher priced gold will tell to buy gold. Only time will tell if they were right.
Source: https://tradingeconomics.com/country-list/gold-reserves
States can't issue their own currency, they're all going wherever the nation goes on this one.
ps im talking about real persons here, not corporations