Walking in the Wilderness

When the time comes to revisit the place from whence we came, will we be prepared?

In a scenario of the global stage refusing to accept US Treasury Notes – what will back the currency? Effectively, the reason the US Dollar has value is because it is the global reserve currency. Without this status, there is not much the US has to bring to the table in a macro economic sense.

Americans have come to rely on goods produced from outside of the country. While the US does represent 52% of it’s own goods made on shore; the rest of the goods imported are from overseas countries made through good-standing trade relations. These relations are at the mercy of the US Dollar as it operates as the world reserve currency.

Though it is the reserve, it has been weaponized against the world. Since it is a debt issued fiat currency, it’s value is tied to the whim of central banks and government spending. When more currency units are created, more inflation occurs. When the value of the dollar declines, cost of goods rise – and this effects everyone relying on that very same dollar. This puts countries around the world at a disadvantage when it comes to trade relations with the US.

Is the world ready to ditch the dollar? Perhaps, but is America ready for the world to ditch the dollar? What happens when imports slow? A general discomfort that people are not use to may rear it’s head on the shores of this country. Are we ready to go without our favorite conveniences? Are we ready to accept a lower quality of life? Some may argue that we have been living in a lower quality of life under this fiat currency regime. Some may argue that we have already experienced the best times that we will see.

Are you ready to walk in the wilderness?