alt Hacker News>China is intentionally undermining the dollar in order to try to make the Yuan the world currency
The constant devaluation makes it unappealing.
> My current hypothesis is that the growth in the _price_ of the US Stock market (eg S&P 500) is actually devaluation of the dollar.
I generally agree. But economic orthodoxy says 'Inflation is only 2%', despite precovid, it seemed more like 4%.
Replies
weberer • yesterday at 6:21 PM
The insidious thing about inflation is that it compounds. Even just a 7% inflation rate will halve your currency's value in just 10 years.
> constant devaluation makes it unappealing
If this is the complaint the dollar is safe. And international holders of dollars aren't idiots. They hold Treasuries, which more or less preserve their purchasing power. (Nobody outside the poor, who have to, and nutters, who don't know better, hold cash as an asset. It's so thoroughly assumed that in finance, cash refers to cash and cash equivalents.)