Disagree with you on gold, but you're right about the greenback. Right now, the U.S. is the #1 superpower (arguably, empire) in the world. Accordingly, the U.S. capital markets are the most liquid in the world.
This means there are a lot of powerful people whose prosperity, power and prestige is hooked to a world that the U.S. predominates in. Until a serviceable replacement comes along, they'll do almost anything to keep the current system afloat.
One of Gary North's favorite sayings is, "You can't beat something with nothing." Paraphrasing, you can't beat the current system with a worldwide collapse.
It's easy for us readers to forget, but the Western Roman Empire did not collapse in two hundred pages or less. The system, from its peak to the time Odoacer took over as KIng of Italy, took a hundred and fifty years - two full human lifetimes - to collapse. There really is a lot of ruin in a nation.
Yes, there literally is no substitute for the dollar at the moment. The euro is a mess because the eurozone is so weak. China's economy is shrinking and they are slowly devaluing the yuan. It is likely the Fed will increase interest rates in December after the election is out of the way.
Gold tends to be a mirror of the dollar though. They are inversely correlated. Gold is also a highly manipulated market about five investment houses control it's price. Whereas the dollar is traded everywhere on earth and is harder to manipulate as a result.
Thanks for the reply. I disagree with you on gold because the chart looks to me like a post-bubble bottoming process has taken place since 2013. Gold used to mirror the greenback, but the last leg of its bull market was fueled by increasing Chinese demand (prosperity) and Indian demand (near double-digit inflation in India, plus prosperity.)
The Chinese, like Indians, still have a tradition of using gold as a long-term savings vehicle. So when times are booming, Chinese demand for gold increases. So the gold market now has a similarity to other metals markets in that they're moved by the ups and downs of the mainland Chinese economy.
(I had to learn about the "globalization of gold" the hard way, tho' not in a costly way. When I was watching the gold market from '09 to '11, I saw it climbing and climbing while I was scratching my head and wondering, "Where's the jump in inflation??" It's not the only hard lesson I had to learn after the '08 crisis.)
Good to know we see things similarly in re the greenback. Declinism is pretty durn seductive, especially to bookish people like me. :)
The Chinese make it really hard for their citzens outside Hong Kong to buy gold. They only thing they are really allowed to own is property, which is why property speculation there dwarfs even what happened in the US in the run up to 2008. If the Chinese property market collapses, a lot of wealth will get destroyed and they will be even less able to buy gold.
India is in a better situation, both with their economy and demand for gold.
Thanks.