This is interesting. I didn't see the FT piece but (a) why do people keep banging on about the euro becoming a reserve currency, at the same time that the EU's fiscal and monetary policy remains deflationary and export-promoting, and that is written into the rules of the new Euro-Fed? The confusion in Brussels seems real, because actually the euro-promoters are selling a false prospectus: the euro cannot become a reserve currency unless the EU clashes head on with US imperialism politically/strategically, and is anyone suggesting THAT as a policy? I still think the euro is just downmarket DM and will only bring stagflation to Europe. What it will NOT become is a reserve currency. (b) If the FT says the benefit to the US of dollar seignorage is $40bn, I'd like to see THAT calculation. Surely the benefit is orders of magnitude more than that; take dollar-denominated oil for one item and ask what would happen to a US economy now 60% dependent on imported oil if it had to EARN the dollars to pay for it. But even that doesn't scratch the surface: dollar seignorage is just another face of US global hegemony, like the 6th Fleet, the CIA, IMF etc... Mark Carrol Cox wrote: > Doug writes: > > > > Of course the U.S. derives great benefit from printing the world's reserve > > currency, but that's another story. A few months ago, the FT printed an > > estimate that the U.S. derives up to $40 billion a year in seignorage > > benefits, which are severely threatened by the euro. > > Just exactlly what or who does "U.S." designate in this paragraph? The > Fed? The government? Or something more complex? > > Carrol
