The US can print the same money it borrows in. It doesn’t ever have to default as long as it retains this privilege. But its creditors now know that the US can’t be trusted. This is why America’s trusted friend and car pool partner in space, Vladimir Putin, has said Americans, “Are living like parasites off the global economy and their monopoly of the dollar.”
Them used to be fightin’ words. But now they are just words that confirm that we have come the end of the dollar’s reign as the world’s reserve currency. This is pushing up yields on government bonds. And in the long run, it will push up the price of precious metals too, as a reserve monetary asset (money).
via Parasitic Capitalism, The Daily Reckoning, Australia, 8/2/2001.