President of Global Affairs & Co-Head Goldman Sachs Global Institute @Goldman Sachs; NYT Bestselling Author of 6 books
It’s been 80 years, a period of historic global growth, since the Bretton Woods Conference established the US dollar as the central pillar of the world economy and of US economic statecraft – but for eight decades, commentators have been predicting that the dollar’s imminent demise is coming. That debate has always missed the mark. No currency in history has performed the same function as the USD, and at this point there are no alternatives that can. But the US’s competitors – and even some partners – are still pushing the boundaries of the financial system at a time when the dollar still dominates and provides enormous benefits, but the post-Cold War consensus is breaking down. What would it take for another country to position its currency as an alternative to the USD? A world-leading, growing economy. Deep, liquid capital markets and trusted financial institutions. Financial safe havens and reliable mediums of exchange and store of value. The USD’s position isn’t guaranteed to last forever – but until another country can replicate those conditions, they won’t create a viable alternative. These efforts will be marginal, but meaningful in a world that’s getting more competitive, and where every advantage matters. See my latest in Foreign Policy where I cover today’s most notable efforts to de-dollarize, including new technologies, sector-specific arrangements, and shifting bilateral and multilateral alignments, where they’ve gained ground, and where and why they’ve fallen short.
Agreed. More over people underestimate the success of exceptionalist policies - which other economic blocks have failed to replicate.
Great rationale for a long term short bet. just need to find what you would be shorting it against. And that's not trivial
No but you might want to hedge as brics matures.
Great article and perspective
Couldn’t agree me more!
You always provide a very interesting perspective Jared Cohen ! Thank you for sharing your inspirations and vision.
shareholder
3moIt has to be regionalized to see how it can compete with China over the long term as the economy does become regionalized alongside the globalization that is happening due to the complexity of the economy that has been built and the interconnection between each and every economy.