Are we experiencing peak dollar as a reserve currency? In this latest episode we examine this complex but crucial question for investors, policymakers, and businesses.

With the federal deficit running at a staggering 8.8% of GDP—a level typically associated with major economic crises rather than normal times—we're witnessing what could be a pivotal moment in global finance.

The dollar's reserve status has provided America with significant advantages: lower borrowing costs and the privilege of seigniorage (essentially getting goods in exchange for printed money). Yet this same strength has gradually eroded American manufacturing competitiveness.

Looking forward, the challenges are mounting. The US needs to refinance
approximately $3 trillion in debt while managing a $1 trillion defence budget and interest costs approaching the same figure. Meanwhile, the Department of Government Efficiency programme has so far fallen short of its savings targets.

This perfect fiscal storm suggests we may see a return to quantitative easing—or to be candid "monetisation"—with governments printing money to pay bills.

While we may be witnessing the early stages of a multi-decade transition rather than an imminent collapse of the dollar system, the current situation deserves close attention from anyone concerned with global economic stability.

This Episodes Book Recommendations

Gerald suggests:
Money & Promises
by Paolo Zannoni

And George recommended:
Deceit and Self-Deception: Fooling Yourself the Better to Fool Others
by Robert Trivers