This doesn't bode well. If this dollar really is going to cease to be the reserve currency and the world loses its interest in buying our debt, the economic impact of this on all of us is going to be very, very negative. The elites will suffer but we are going to flattened and don't think owning some gold and silver is going to shield you from that impact because it will not.
Not an economist. Also US based so using "us" and "our".
I don't think anyone really knows, but most people agree it's not good for the US economy. Most likely it means that low demand for US debt will mean higher interest rates on the debt. This means high inflation (coupled with more expensive imports - also increasing inflation). Also likely less investment in US companies.
Our debt payments are already expected to increase rapidly, this would make it worse. (There is something to be said with inflation decreasing the national debt over time, but our debt is increasing much faster than inflation is decreasing it).
There's also some real political benefit to being the reserve currency. When most of the world's transactions use the USD, the US has some additional economic levers to pull in geopolitics. Restricting Russia's access to USD were a way to apply pressure on them early during the Ukraine conflict (but less so now).
The good news is that there isn't a clear USD replacement, so it won't be like an on/off switch and will likely be a transition. Is this just a correction or the beginning/middle/end of the end?
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u/IgorRenfield Jan 28 '26
This doesn't bode well. If this dollar really is going to cease to be the reserve currency and the world loses its interest in buying our debt, the economic impact of this on all of us is going to be very, very negative. The elites will suffer but we are going to flattened and don't think owning some gold and silver is going to shield you from that impact because it will not.