With the Asian hegemons undoubtedly able to introduce gold standards, where does that leave the dollar? This article describes just how precarious the fiat dollar’s position has become. For now, the dollar appears to be buoyed up by rising bond yields. However, as they rise further portfolio losses for foreign investors are likely to increase, leading to dollar liquidation. It is not generally realised how many dollars and dollar securities are owned by foreigners, the bulk of them being held outside the US banking system. And the quantity of foreign currency owned by Americans to absorb this selling is very small in comparison.
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