Since the demise of the Bretton Woods system in 1971, the world has become increasingly dependent on the US dollar. The US dollar continues to fulfill an important role as the world’s reserve currency and as a result the United States is basically obliged to provide the world with sufficient dollars.

In order to do so, the United States must import more goods every year than it exports. The difference is paid for in dollars; dollars that can then be used by other countries to import oil and other commodities. This worldwide dependence on the dollar has meant that the United States can structurally live far beyond its means.

The United States has suffered a structural trade deficit since 1971. Source: BEA

The Triffin Dilemma

Debt Is Not an Acute Problem

The Dollar as a Financial Weapon

Trade in Other Currencies


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