Naval Dominance and the Global Significance of the U.S. Dollar
Mike Novogratz, the billionaire CEO of Galaxy Digital, asserts that the United States’ control of the seas is integral to upholding the dollar’s reserve currency status.
According to Novogratz, the joint military strikes by the U.S. and the U.K. on Yemen were strategically necessary, providing American residents with the advantageous ability to “borrow endlessly at low rates.” This perspective comes amid heightened tensions in the Red Sea, with an escalating number of attacks on commercial ships prompting shipping companies to suspend operations, leading to supply chain disruptions and production delays, as seen with Tesla’s factory in Germany.
Novogratz estimates the cost of maintaining reserve currency status to be around $1 trillion, approximately 4% of the U.S. GDP. Despite criticism from some followers, he emphasizes the strategic importance of these actions. Meanwhile, concerns are voiced about the potential decline of the U.S. dollar’s dominance in a changing global landscape, with one user expressing gratitude for alternatives like Bitcoin. The ongoing geopolitical dynamics underscore the intricate relationship between military actions, economic interests, and the maintenance of a reserve currency.
Clever Robot News Desk 16th January 2024
