Is the US Dollar accepted everywhere in the world?
I've read that the US Dollar is one of the most coveted forms of currency.
The US dollar is the standard currency in international markets, but that doesn't mean it's accepted in every country. I think the only countries were the US has been adopted as official currency are Panama, Ecuador, and El Salvador. Other countries like Bahamas, Argentina, Saudi Arabia attach their own currencies to the dollar at certain fixed rates. Finally, other countries like Peru and Canada the dollar is commonly accepted, but not officially. But in no way is the US dollar close to be "accepted everywhere".
Good question. It is still the most reliable currency in the world. However, that is somewhat by default. The US has become the tallest midget in the room from an economic perspective. Many nations have attempted to diversify away from the dollar, but they don't have many alternatives at the moment. However, in many places across the world where the dollar was always accepted, that is not always the case anymore. I personally think we are a ways away from a run on the dollar. But at some point it is quite possible that the US could lose it's reserve status at the reserve currency. The impact of such an event would have significant economic implications. As one example, US citizens have had the benefit of much lower oil prices when compared to Europeans. One reason is oil is priced in dollars. Should that not be the case anymore, the cost of energy would likely rise substantially for the average american. And coincidentally, there have been reports about China and Russia trading in oil outside of the dollar as the standard currency in recent years. If that where to become a global trend, that is one example of the implications of the loss of reserve status. All the more reason for the US to get it's fiscal house in order.
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