Former French finance minister (eventually president) Valéry Giscard d’Estaing bemoaned a US that took advantage of its privileged position as the world’s dominant reserve currency and drew freely on the rest of the world to support its over-extended standard of living.
But for the dollar to lose its position as a major reserve currency, there will have to be an alternative ready to supplant it; you cannot replace something with nothing.
And there is not yet a clear alternative available.
PS: Is there something people still get wrong about the 2008 financial crisis – and need to get right in responding to the COVID-19 crisis?
NR: Monetized fiscal deficits may be the appropriate policy response when a credit crunch triggers a collapse of aggregate demand that threatens to lead to deflation. That is what happened in 2008.
Persistent monetized fiscal deficits could, in a couple of years or so, lead to simultaneous recession and inflation. So-called stagflation
Nouriel Roubini Project Syndicate 6 October 2020
Skapar centralbankerna stagflation? Experter tvekar.