The greenback’s dominance isn’t simply highly effective, it’s parasitic, banker Mohit Munjal argued in a takedown of the worldwide monetary system that forces nations to bankroll America’s deficits on the expense of their very own sovereignty.
In a LinkedIn publish, Munjal dismantled the post-WWII structure that handed the U.S. management of the world’s monetary plumbing. From Bretton Woods to the petrodollar pact of the ’70s, he argues, the system has been rigged to maintain the greenback on prime—whatever the injury it inflicts elsewhere.
“A rustic can run balanced budgets, have low exterior debt, but when it has a present account deficit, it should discover {dollars},” Munjal writes.
“How? By borrowing them or by opening up its markets to overseas capital.” That strain, he says, crushed growing economies like India in 1991, when foreign exchange reserves plunged to simply two weeks of import cowl.
Liberalization adopted, however not with out value. Overseas capital poured in, propping up India’s stability sheet—whereas home belongings quietly shifted into overseas palms.
Globally, the sport performs out the identical. Nations earn {dollars} by means of commerce, then recycle them into U.S. Treasury bonds. “Over 60% of worldwide FX reserves—roughly $7.5 trillion—are held in USD belongings,” Munjal notes.
“In impact, international locations are pressured to lend again to the U.S. the very {dollars} they earn.”
That lets America run twin deficits — fiscal and present account — whereas its public debt soars above 120% of GDP. And but, it retains a AA+ score. “Most growing international locations would by no means be allowed to get away with that,” Munjal factors out.
He doesn’t spare China both, calling its deliberate yuan suppression a tax on residents to spice up exports.
So when international locations transfer to limit FDI, impose tariffs, or ditch the greenback, Munjal argues, they’re not being “anti-USA.” They’re defending what little autonomy they’ve left.
The collapse of the greenback? “Nobody can predict when,” he writes. “However the writing on the wall is now boldening, and extra international locations are beginning to learn it.”
