Alan Blinder vs. Peter Schiff: When Will the Dollar Lose Its Reserve Status?

The almighty dollar ain't what it used to be.

The decline of the dollar was one of the topics of debate Sunday night when St. Louis Fed President Jim Bullard and former Federal Reserve Vice Chairman Alan Blinder faced off against longtime gold bug and dollar bear Peter Schiff at a panel hosted by Princeton's Business Today.

Bullard, who doesn't often discuss the dollar, does have hope for the greenback. When the world was in full panic mode last year, Bullard notes the dollar actually gained value in a "flight to safety" trade, even though the Fed was flooding the market with supply.

While that may be true for now, Blinder "can imagine the Chinese currency being the dominant reserve currency in the world in 30, 40, 50 years from now."

Peter Schiff, in predictable fashion, says the dollar's day of reckoning is coming much sooner than they think, citing artificially low interest rates and America's rising debt obligations.

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[bjarnet3]

LOL,,, they flee the dollar next time...

How long are Americans going to listen to peoples who got i wrong all the time... You can always find a excuse afterwards...

But when peoples like Schiff, Ron Paul predicts crisis before it has happened. And explaining precisely what is going to happen, how is going to happen and why it is going to happen. It clearly speaks for itself.

It was not that Peter was right, it was how he explained things so precisely, so easy to understand. Go Peter!!!

[theguvnorjimmy]

Buy Gold and silver!!!!!

[pfeiffer101]

Peter Schiff is awesome

[lwglwglwg]

Gotta love Peter's foresight! Less than one year later, look at what's happening to Dollar now? Just prescient!

[zbigniewzapora]

@zbigniewzapora

Of course in government (monopoly) absence all this would be voluntarily funded just like every other business.

[zbigniewzapora]

@edschaeffer

Problem with government is that it continually grows - every intervention leads to some sort of disaster that politicians try to be remedy by another intervention and so on. Best thing is that it is always fault of free market and politicians are always innocent and glad to be our saviors when they are in reality the root of our problems.

[zbigniewzapora]

@edschaeffer

Only logical conclusion to free market philosophy is anarcho-capitalism or voluntaryism of which I'm proponent. Ancap position is more nuanced than just abolishing government - ancap is not about abolishing law, police or destroying roads, but about abolishing violent monopoly over them so we can reap benefits of competition without monopolies created by government or monopoly of government itself.

[zbigniewzapora]

@edschaeffer

Second part of your argument about free market is really just about understanding what free market is and what government is. Free market are voluntary exchanges, government is violent monopoly over creating and upholding of law basically so it is negation of former. Rich people like you mentioned have high incentive (spend a little on politicians, reap profits from being monopoly thanks to law) to buy up this monopoly so it serves their needs.

[zbigniewzapora]

@edschaeffer

So you are saying that by your definition scientific method is logical fallacy. You should really read up on things you are trying to debate and especially on methodology and epistemology of various schools of economic thought. It will really help you understand how little you know and give you some humility. I don't reject neoclassical school on basis of some youtube video. You should extend this courtesy to my views.

[edschaeffer]

@zbigniewzapora - Yes, my argument is ad populum, but so is the scientific method. Do you reject the scientific method? Austrian economics rejects the scientific method. Mainstream economic theories are "ad populum" because one can successfully prove a correlation on an outcome. The opposite is true for Austrians. Laissez-faire is proven to be destructive to a market. Take JP Morgan, Rockefeller, Carnegie these men crushed the competition due to lack of regulation whichAustrians wish to reclaim

[zbigniewzapora]

@edschaeffer

Your argument is rigged with ad populum and ad verecundiam so please provide more logically coherent arguments as to why you think AE is nonsense. As for gold - nothing has inherent value, every value is subjective, so it may be that for Shiff gold is more valuable and stocks are more valuable to you. Also remember that economics is value-free science - if you see anyone making any valuations thats not economics - that just an entrepreneurship decision or simple opinion.

[edschaeffer]

@zbigniewzapora - Whatever dude. How does it make you feel that Austrian economics has been out for 100 years, hasn't changed in theory, and is completely in conflict with academia? Not one Austrian economics "textbook" is on the required reading list for economics at any major college. Doesn't that tell you something? Anyone who believes in the value of gold over stocks is a fool. lol