Goldtent TA Paradise

DXY? Gold? Dollar-hatred?

1. Chartsmaster says:

   May 31, 2023 - 3:58 pm at 3:58 pm

   A good read (about the past). While the author points out interesting history he is wrong in his conclusion that the dollar angst is overblown. The reason he is wrong is because he states there isn’t any alternative to the dollar as the reserve currency. He doesn’t address that this time actually IS different. While gold has always played a role as a portion of nations’ reserves, he misses the two salient points. First, until 1971 the reserve currency was backed and convertible into gold so it actually had value. Second, the amount of accumulated debt of the reserve currency nation(US) is out of control making the currency technically worthless. Add in the fact that the global central banks in the form of the BIS changed the rules regarding the value and accounting for gold as a means of monetary reserves. That is what is different. Nations are now moving to gold as their primary form of reserves. So even if he is technically correct that at the present time there is no other fiat currency to replace the USD as the reserve currency, the world doesn’t need one. It has gold, reverting back to it’s centuries old role as the primary form of reserves. It is only in this outlier period of the global reserve currency being fiat only during the last 50 years. That is recency bias and one must go back over hundreds of years for perspective. The dollar may not be replaced by any other fiat currency as the global reserve because you don’t need another replacemnet when you have the real thing already here. GOLD! Yes the USD will probably continue to be used in transactions until it totally collapses but it is rapidly being removed from it’s role as a store of value as more countries move a larger portion of their reserves into gold.

2. Gold Learner says:

   May 31, 2023 - 6:27 pm at 6:27 pm

   Great points and some excellent feedback, Sir CM.
   Thank you.

   GL