"defend it from what?!" was my first reaction to this headline
Love also that the caption picture the FT picked was... melting ice cream cones!
U trying to tell us something about fiat currencies, eh?!
OK, so what's this about?
not least because Trump is undeniably on the monetary warpath: on Truth Social last month he repeated threats to impose “100% Tariffs” on countries trying to “replace the mighty U.S. Dollar” with new currencies or payments systems.
...ugh, it's the Trumpman again. Still, Tett has a point:
After all (as I have noted before), it is the dollar-based global financial system that is the real source of America’s hegemonic power today, and which Washington wants to defend.
- dollars still 58% of CB reserves, trending down, but might take forever to get anywhere...
- 49.1% of all payments in dollars (according to Swift).
Two problems: CBs are hovering up gold (#889502, #885194) like crazy... and the Swift data doesn't have the non-Western payment platform transactions included (so the "true" global payment share of the dollar is markedly lower).
Weaponization of the dollar... or an inevitable bitcoin angle and/or stablecoin Treasury financing?
Trump seems minded to use sticks. Last month he issued an executive order banning any central bank digital currency usage in America, since they “threaten the stability of the financial system, individual privacy, and the sovereignty of the United States”. Instead, he championed bitcoin (never mind that this is viewed as a fiat dollar hedge). More significantly, he also backed the “growth of lawful and legitimate dollar-backed stablecoins worldwide”.
...
non-paywalled here: https://archive.md/bM73a