Within the context of the power struggle and the competition to dominate global trade, a major issue is that of seniorage, or the privilege bestowed, by default, on the country producing the world’s reserve currency. Seniorage refers to the difference between the value of the bullion in a coin, the value of the bullion needed to produce a coin, and the value of the coin itself, within whatever monetary system is dominant. The difference in the value of bullion in a coin and the purchasing value that the coin carries becomes the layer of liquidity coursing through the global capital markets at any given time. In other words, seniorage is the means to monetary debasement of a currency.
Under the Bretton Woods system, the value of the U.S. dollar (USD) was fixed to gold, which was convertible for dollars only for international center banks and governments, with all other currencies aligned to the dollar-gold anchor. Thus, the United States gained unprecedented advantage through seniorage, and it provided the liquidity necessary to fund war reparations in Europe.
Key to my own monetary mantra is that seniorage, over time, has increased on a theoretical basis, as a percentage of the real value of any currency, including the world’s reserve currency. In fact, ever since the U.S. dollar gold standard was abandoned in 1971, seniorage really has been 100 percent, given that every dollar now created is nothing more than a paper credit, backed by faith, rather than gold. ...

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