Political Economy Forum #83 - How much longer can the US Dollar stay on top? - w/ Herman Mark Schwartz
5 snips
Aug 22, 2022 Herman Mark Schwartz, an academic from the University of Virginia, dives into the enduring dominance of the US Dollar as the world’s primary currency. He discusses the surprising persistence of dollar reliance despite ongoing current account deficits and examines the intricate relationship between trust in government institutions and monetary value. Schwartz also explores how economic struggles in countries like Ruritania and shifts towards protectionism impact global finance. The conversation raises questions about the future of the dollar in a changing political and economic landscape.
AI Snips
Chapters
Transcript
Episode notes
The Dollar's Puzzling Reign
- The US runs a persistent trade deficit, yet the dollar remains the central global currency.
- This is puzzling because it implies the world continuously lends to the US despite its borrowing habits.
The Nature of Money
- Most money exists as electronic records of debt, not physical cash.
- These records represent promises of future performance, like providing goods or services.
The Hierarchy of Money
- Money's value rests on its acceptability, forming a hierarchy based on trust.
- State-issued money holds the highest value as it's accepted for tax payments, backed by coercive power.