When will the dollar crash and what it will lead to
Everyone is talking about the collapse of the US dollar: In recent years, predictions about the inevitable collapse of the US dollar have been increasingly heard.
Renowned financier Peter Schiff asserts: “The American currency is doomed, and the only question is when its final collapse will occur.”.
Analyst Ray Dalio supports this view: “The dollar is losing its position as a global reserve asset, which makes it vulnerable in the long term.”.
Economist and author Jim Rickards emphasizes that "a massive increase in government debt and unlimited money creation by the Fed will inevitably lead to currency devaluation.".
Reasons for the Possible Collapse of the US Dollar
The main reasons that could lead to the collapse of the dollar:
Rising public debt : The US public debt has exceeded $33 trillion, significantly increasing risks to financial stability.
Unlimited Monetary Stimulus : The Federal Reserve's ongoing quantitative easing programs are leading to inflation and devaluation.
Geopolitical changes : The decline of US influence in the world and the strengthening of alternative currency unions such as BRICS are contributing to a decrease in demand for the dollar.
Crisis of confidence : If international investors and debt holders start to flee dollar assets en masse, this will cause a sharp fall in the exchange rate.
Forecast for the timing of the collapse of the US dollar
Despite the dire forecasts, most analysts agree that the dollar's collapse will not happen anytime soon.
Such judgments are based on the following compelling reasons:
Lack of a full-fledged alternative : other currencies do not yet have the necessary stability and liquidity to fully replace the dollar. The only alternative to the dollar currently is the euro, but it is also experiencing certain difficulties.
Strong American Economy : The United States remains the world's largest economy with a strong domestic market and technological superiority.
The dollar as a reserve currency : the global financial system is still firmly tied to dollar settlements, and restructuring this system will take decades.
However, if current trends continue, analysts suggest the dollar could face serious challenges between 2030 and 2040.
A collapse of the US dollar is a potential threat, but the near-term future of the American currency remains stable. As long as the global financial system remains heavily dependent on the dollar and there is no viable alternative, a sharp collapse is unlikely.
However, it is advisable to transfer long-term savings into more stable assets such as gold, real estate or Bitcoin.
