Here's what's going on, roughly.
1. The US exerts hard and soft power to maintain its control of the world's capital goods ( including intellectual and human capital).
2. Nominally, the US pays for this by borrowing FX from other states. Interest is paid by the US, via recursive borrowing, similar to a pyramid scheme. All states do this to various degrees.
3. As money enters the global economy, inflation chases monetary expansion. As inflation rises, the REAL debt burden is eroded, as future money is worth less than present money.
As to why this doesn't benefit all global states equally, see 1. Money is a charade for peons. Real power remains in warcraft, spycraft, loyalty of talent, and godcraft ( aspirational branding ).
4. US fiscal and monetary policy may then, always, be viewed as a political device, to export inflation faster than the next state.
How, one might ask, might this lead be lost? Perhaps see 3. ... just keep an eye on the crafts of state, and one might gain a sense of the times.
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This was another reason I didn't stay in the US in 2005. Yet I must say, I had not studied the physics of this very closely at the time. It is amazing how little we speak of the global monetary system in daily parlance, even among professionals.
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Addendum : Following up on yesterday's thoughts, it seems the white swan of 2024 is a sudden devaluation of US treasuries, triggering risk/regulatory-ratio havoc in the banking sector. But that's no swan, it's been the white whale of global finance for nearly a century (!). Let's see what this year's election and Putin's war will bring.
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