|The new $100 bill, with its additional anti-counterfeiting features|
The $100 bill is an especially hot item on the global stage: The Federal Reserve estimates that one-half to two-thirds of $100 notes in circulation are abroad at any given time, making them one of the nation’s largest exports.
Of course, most money doesn't exist in paper form, just in electronic notation. So, how much does it benefit America that the digital dollar is the reserve currency for, say, the oil trade? Former French president Valery Giscard d'Estaing argued that the U.S. enjoyed a sizable "exorbitant privilege." This Wikipedia article sums up various studies attempting to quantify this concept, but they make my head hurt.
But, the vague sense that a few insiders' heads must not hurt so that we'd all better do what they say, has vague but broad political effects. Because I, like most people, don't comprehend anything about reserve currencies, I find myself a sucker for those who intimate that they know just how uncountable are the benefits America gets from dollars being the reserve currency and that they know how to keep the dollar the reserve currency.
So, they imply, if the government were to prosecute Wall Street muckety-mucks, or tax billionaires more, or not build the F-35 flying money pit, or not bomb Syria, or not invite the world, or whatever violates this moment's DC-NY Economist-reading consensus ... well that would have catastrophic consequences that little me can't begin to understand. They obviously must understand things I don't, so who am I to question their plans to, say, build 10 new aircraft carriers?