ZMan has a typically-mordant look at the global economy:
The Global American Empire has been supported for the past half century by a novel form of seigniorage. This is the difference between the value of money and the cost to produce and distribute it. In the old days, the king would make a profit from the minting of coins used in his kingdom. This was usually a tax added to the total cost of a coin on top of the cost of production. This was the king’s profit from coinage.
Since the Louvre accords in the 1980s, Washington has been able to swap securities for newly printed banknotes by the Federal Reserve. This would normally impose an inflation tax on the public, but the dollar being the reserve currency of the world spread this tax over the global economy. Inflation rates in the United States remained low, as long as global growth remained high and the world was willing to tolerate this system.
The bigger issue is that the rest of the world is losing interest in the system that profits Washington at their expense. China has been manipulating its currency for a few years as a way to prevent Washington from exporting inflation to Beijing. She has also been quietly building parallel financial structures, along with Russia and India, in order to escape the perfidious rules imposed by Washington.
Which means that if the $US is replaced by some other form of currency, we’re fucked. The only bright side of that scenario is that other currencies are even more shaky than ours (yuan coff coff) and a commodity-based system such as gold is impossible because quite frankly, there is no commodity on Earth large enough to replace the dollar without a radical devaluation of, well, everything.
Sobering stuff, all the same. Read all of it.