Bretton Woods Revisited

Good history of the US Dollar system and its implications

The way the modern system works is that money has network effects, and the US is a large economy with an extraordinarily well-developed financial sector, so any asset is priced in dollars by default. Bilateral trade between non-dollar, non-Euro countries countries is usually done in dollars, so a 1% increase in the value of the dollar leads to a 0.6-0.8% change in trade between all other countries.

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