politics
Welcome to the discussion of US Politics!
Rules:
- Post only links to articles, Title must fairly describe link contents. If your title differs from the site’s, it should only be to add context or be more descriptive. Do not post entire articles in the body or in the comments.
Links must be to the original source, not an aggregator like Google Amp, MSN, or Yahoo.
Example:
- Articles must be relevant to politics. Links must be to quality and original content. Articles should be worth reading. Clickbait, stub articles, and rehosted or stolen content are not allowed. Check your source for Reliability and Bias here.
- Be civil, No violations of TOS. It’s OK to say the subject of an article is behaving like a (pejorative, pejorative). It’s NOT OK to say another USER is (pejorative). Strong language is fine, just not directed at other members. Engage in good-faith and with respect! This includes accusing another user of being a bot or paid actor. Trolling is uncivil and is grounds for removal and/or a community ban.
- No memes, trolling, or low-effort comments. Reposts, misinformation, off-topic, trolling, or offensive. Similarly, if you see posts along these lines, do not engage. Report them, block them, and live a happier life than they do. We see too many slapfights that boil down to "Mom! He's bugging me!" and "I'm not touching you!" Going forward, slapfights will result in removed comments and temp bans to cool off.
- Vote based on comment quality, not agreement. This community aims to foster discussion; please reward people for putting effort into articulating their viewpoint, even if you disagree with it.
- No hate speech, slurs, celebrating death, advocating violence, or abusive language. This will result in a ban. Usernames containing racist, or inappropriate slurs will be banned without warning
We ask that the users report any comment or post that violate the rules, to use critical thinking when reading, posting or commenting. Users that post off-topic spam, advocate violence, have multiple comments or posts removed, weaponize reports or violate the code of conduct will be banned.
All posts and comments will be reviewed on a case-by-case basis. This means that some content that violates the rules may be allowed, while other content that does not violate the rules may be removed. The moderators retain the right to remove any content and ban users.
That's all the rules!
Civic Links
• Congressional Awards Program
• Library of Congress Legislative Resources
• U.S. House of Representatives
Partnered Communities:
• News
view the rest of the comments
I've seen other articles floating this idea but is this something that's confirmed? This article refers to the Wall Street Journal but is there a concrete source in which EU representatives are quoted or a written proposal that would suggest such a course of action for me to look up?
Not that I have been able to find. This news source is also considered to typically not be credible.
I was going to ask the same. Also how come a US outlet has this and I haven't seen anything on Europe-centric channels.
Sometimes one just has to wait a day or so.
I'm also unclear about what "dumping" those trillions actually means? If we truly had the USA by the balls like that I'm sure I'd have heard about this sooner.
Everyone has the US by the balls, that's what the USD being reserve currency means.
Everyone owns a lot of USD, both cash and securities, so when the US prints money, inflation hits all the world.
Dumping basically means saying "hey, I've got the entire US GDP here in cash USD, I'm selling it for 100 EUR", and watching the US go hyperinflating.
The catch is that it would crash the world economy.
Oh. That sounds like a lose-lose situation.
That's why for once, the press' nuke metaphors are apt.
It's also absurd. No holder of that much paper would take that write-down on their balance sheet, and even if they did, whoever bought that debt for EU100 could sell it for far more and earn a fortune. Equilibrium would almost instantaneously be restored.
And the thinking about the risk of USD's status as a reserve currency is largely magical. It's a reserve currency because of the stability and strength of the economy that backs it. But most of the disaster scenarios are based on that causality being reversed.
If, for some reason, USD was no longer used as a reserve currency, that would introduce friction to trade with the US, since there would need to be currency exchange done. For high volumes, that might add a fraction of a percent to transaction costs. That's not enough to lead to massive changes in trade flows. And the liquidity of US government debt markets might be lessened, but liquidity is more a threshold phenomenon than a continuous one: 20% less liquidity in a market makes no difference, unless that means there's not enough liquidity remaining to clear that market.