What's up with the dollar?

[Narkos]

Some of my Alex Jones/Ron Paul "friends" are all in a tizzy about this article about the dollar in today's NYPost (http://www.nypost.com/p/news/business/dollar_loses_reserve_status_to_yen_hFyfwvpBW1YYLykSJwTTEL;jsessionid=65E301CF47ED50D15170F8D6530791C5) Is there any significance to this? Does it really matter if the dollar is the reserve currency?

[tridim]

1. Ron Paul people are ALWAYS in a tizzy about something. nt

[Celebration]

2. yes it does matter

The value of the dollar falls in relation to other currencies. That means the value of our savings (in dollar terms) falls. Short term, it is good for the stock market--in dollar terms. The Dow Jones goes up because it is being priced in dollars that are worth less.

Having said that, our leaders would like the dollar to fall, so that we can repay our debts in dollars that are worth less. We just don't want the dollar to fall too fast (think: monetary collapse).

[Narkos]

3. Will that impact the average consumer?

[Celebration]

4. of course

Eventually, if the dollar falls enough, commodities like oil and food will cost a lot more in dollar terms. Think: commodity inflation!! Our dollars are worth less so it takes more of them to purchase things. It's supply and demand.

[OllieLotte]

5. I disagree with the statement that the U$D has been replaced.

Over time it might happen, but I see no evidence that it already has happened.

[Celebration]

6. the dollar has lost value

Why is that? For whatever reason, it is not in as much demand as a few months ago. That doesn't mean that dollar reserves are getting immediately replaced by other currencies. At this point it is just a bit of diversification at the margin. But, there is at least a mini trend in place.