Originally Posted by Webby

It is kinda frightening - even now when the dollar happens to be low, any prospect of eg China dumping some of their billions in US dollar currencies can screw the dollar even more.

There is little interest in China doing this, but they have been trying to pass out dollars into other currencies for a few years - and the current lowish value has got to be tempting from them to dump more.

Flipside, it's all a game and a matter of keeping a balance. It's not in anyone's interest to see any country be damaged economically, and that includes the main creditor, China.

But... bottom line, it's obvious (and has been for a number of years) that the current scenario is not sustainable. The US seriously needs to earn hardcore asset value and this would prob come from having a trade surplus over a sustained period.