How many times do we hear the forces of doom--primarily from the right wing that wants to end just about everything government does that can help the American people--that we cannot going on "borrowing from China"?
No matter how hard the Fed pushes, the U.S. economy isn't going to respond to yet another round of quantitative easing. There is, however, at least one price that another round of quantitative easing is bound to send higher -- the cost of oil.
While it is true that the purchasing power of the dollar is a key metric to judge the direction of gold prices, the Dollar Index will only tell you what the dollar is doing against a basket of 6 other flawed fiat currencies.
Foreign borrowings of the U.S. represent a clear and present danger to the dollar and to the financial system. Potential dumping of U.S. dollars would start a run on the currency and a financial panic that would tip our already precarious economy into a deep depression.
There is no such thing as the US becoming the next Greece. There is no such thing as the US getting cut off from spending by the financial markets and forced to go begging to the IMF to get US dollars to spend.
The headline progressives are in full retreat. They have found out the hard way that their bleeding heart pleadings -- 'yes, the financial markets might destroy us, but how can we cut this or that worthy cause' -- don't cut it.
In the absence of any realistic alternative to replace the supremacy of the dollar, it is likely to remain the dominant global currency for many years to come. No other currency is more widely accepted or used.