- Fink 🧠
- Posts
- 💵 Why The US Dollar Is The Greatest Invention Of All Time
💵 Why The US Dollar Is The Greatest Invention Of All Time
In partnership with Utrust, the only crypto payments gateway your business needs 👇
Times of change, but the goal remains the same: fairness and freedom.
How different would the world be if everyone was aware of this? #utrustxMoney #xMoney #MultiversX #cryptopayments #crypto #Web3 pic.twitter.com/theAxx1PDl— Utrust (🔜 xMoney) (@UTRUST) April 14, 2023
Heard of Thomas Edison? The guy who invented the lightbulb (and definitely didn't steal any ideas from Nikola Tesla). Sure... He invented something we use a lot these days, but it's a PATHETIC EFFORT if we're being honest.
People talk about electricity & AI as if they're something special, but we've already had the greatest invention there is and ever will be. 👇
The US Dollar
Bitcoinoooor trigger warning: the following passages are likely to cause acute feelings of loss, grief, and a strong desire to cope harder
The dollar is genuinely humanity's greatest ever invention. Macrodesiac has undertaken a rigorous, in-depth real-world market study to back up this conclusion.
1. It's literally accepted EVERYWHERE
To test this, we visited the Wakalulu tribe in Africa to buy some tiger balm for David's aches and pains from the gym.
The tribe elder took our dollars into a hut and exchanged them for Wakalulu Doonabars so that we could pay the witch doctor. Transaction completed.
In the next village, David wanted a protein bar. Surprisingly, they were in stock, but the shop wouldn't accept our Wakalulu Doonabars. Said they were basically worthless. Just wanted dollars again.
We continued our quest to see what else we could uncover...
2. Commodity Pricing
Obviously we needed to fly to our next destination. But the private plane was low on fuel. We went to the refinery to buy some, and they were all out of oil. Terrible luck!
So we had a chat with a mate at Vitol. Need a cheeky plane load of jet fuel bro! Brokered a cheeky oil deal between Vitol and the refinery. Even though we weren't in America, it turned out that all of the contracts were priced in dollars too.
Apparently, the general stability of the value of the dollar made it the most desirable currency to price in. Which brings us to...
3. Trade Invoicing
In this life as an influencoooor, we don't usually pay bills. People just give us free stuff in exchange for us getting them social media followings. So, it was a real shock to be presented with invoices.
Our trip organiser, Bob, sat us down and went through the bills from ten different countries. All of them were in dollars. We had some spare Chinese renminbi, so we tried to barter and settle in that, but he outright refused.
"Listen guys, I'm gonna level with you. Most of the world's trade is invoiced in dollars. Stop f**king about, and pay up"
Bob's got an old school mafia accent, and we don't really know his history so it was kinda menacing actually.
He pulled up this chart to explain...
Figure 5. Share of export invoicing
He pointed out how loads of trade is priced in dollars. Commodities, products, the lot. Then he started laughing like a maniac. What's up Bob?
"You know all those stablecoins? They're all dollar knock-offs. Nobody wants any of the others! Me and the boys woulda got banged up for counterfeiting back in the day ahahahahaaaaaaa"
Bob's definitely got a past. And a point.
See, USD stablecoins have a market cap well over $100 billion, with 24h volumes of $25 to $30bn. EUR stablecoins have a market cap of just $202 million, with 24h volumes of $7 million or so...
4. Governance & Law
Anyhow, there's another thing that keeps cropping up. The legal system.
As soon as we landed in the states we tried to sue someone just to test it out. Turns out shorting stock indices isn't a crime. However, the lawyer did explain negative expectancy to us, then used the dollars we paid her to buy QQQ calls and prove a point.
Seriously, it's all about common law. We dropped in on Jay Newman & Meyrick Chapman at Politico HQ for a chat... (they're journos, so we struggled to get a word in edgeways tbh)
"... the 'dollar' isn’t just a pile of banknotes: It’s shorthand for an intricate web of institutions structured to ensure property rights — laws, rules, clearing systems, messaging systems and relationships among thousands of central and commercial banks, financial institutions and businesses"
Wow, sounds gre...! Oh you hadn't finished?
Perhaps most importantly, common law is built on court systems that function with integrity, transparency and flexibility.
In common law systems, there’s a constant interplay between the legal system, legislatures and society in ways that are impossible to achieve in a civil law system — and, of course impossible in authoritarian countries.
And the power of common law is often most evident in the fundamental principle that governs legal actions — full disclosure.
The complete, often intrusive, disgorgement of all information relevant to any case at hand is mandatory, which makes the legal process less amenable to powerful interests and less susceptible to fraud.
Totally. This 'intrusive disgorgement' can be pretty funny too - Remember when Block were sued for buying Tidal? 👇
Zinger! Oh you still hadn't finished? Stay on topic. Yep righto...
Common law has thus proven itself to be uniquely adaptable to new businesses and new ways of conducting business, making it the global legal standard for mobile transactions, maritime, commodity trading, swaps and derivatives, international insurance contracts and, increasingly, digital assets.
Comprehensive. Thanks guys. Sounds like the legal system is a key cornerstone! Who knew?
Next leg of our jet-setting trip... Kenya
5. De-Dollarisation
Met up with Kenya's president. Had a chat, bit of a laugh. Then he said we had to buy Kenyan shillings if we were planning to stick around. Said it makes no sense to use dollars.
“From Djibouti selling to Kenya or traders from Kenya selling to Djibouti, we have to look for US dollars. How is US dollars part of the trade between Djibouti and Kenya? Why?”
Fortunately, we weren't staying. When we suggested it was to do with trust, and, you know, all the reasons we mentioned above, he didn't look happy...
Turns out he's become a lot more supportive of a Pan African Payment and Settlement System since Kenya basically ran out of dollars.
Probably a coincidence..
So we left Kenya, jumped on our private plane, and took the scenic route back to Britain by flying over the US... It's just HUGE. Turns out it's the...
6. World's Biggest Economy
Shocking I know. We borrowed an AI camera from the folks at Visual Capitalist, applied the economic filter, and took this picture of the global economy as we flew over 👇
So, as the US is the most important economy in the world, it makes sense that their currency would be so in demand.
Likewise, countries that run a trade surplus with the US end up with a load of excess savings and nowhere to put them, which results in...
7. Dollar Savings
Tim had a chat with the Two Michaels to explain this
By definition, if your economy is running a trade surplus, it means you're producing more than you domestically consume.
This phenomenon creates 'excess' profits (savings) that the domestic economy cannot absorb.
Sure, you can invest in more production, but that just makes the eventual problem bigger. An even larger trade surplus and even more savings. So you need to look further afield.
And there's only one economy large and open enough to absorb those savings (as investments). The United States, and their greatest invention...
The US dollar