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Comment by oneoff786 | Hacker News Reader

It will continue. The dollar is rising because people need American stuff, not in spite of it. So long as Europe doesn’t have Russian gas, the rest of the world will be competing over a much smaller pool of energy in the form of LNG meaning it’s just much more expensive to do manufacturing.

It’s not black and white but I would expect energy burdens to outweigh labor burdens for a good long while.

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> The dollar is rising because people need American stuff, not in spite of it.

Need is doing a lot of work here. Recently our trade deficit recovered from a trough of growing at the rate of $100 billion a month back to $70 billion a month. For comparison, during the entire 2010s, it only grew by $40 billion a month. We haven't had a trade surplus since 1991, when we managed it for a quarter, and before then not since Reagan was elected.

https://fred.stlouisfed.org/series/BOPGSTB

> The dollar is rising because people need American stuff

Not really, and the USA trade deficit is going to get worse because USA stuff is more expensive due to exchange rates.

There is increased demand for usd because:

1) Europeans are sick of low/negative yields at home, and

2) some big non-USA borrowers issued debt in usd and must pay it back in usd.

1) Europe is set for a decade of decline and money is fleeing it.

2) this has been the case for decades and isn’t novel at all. It is noteworthy however when your usd denominated debt becomes much more expensive due to currency exchanges

Why not both? This huge workforce called the boomers accelerated their retirement during COVID and those workers don't entirely have a 1-to 1 replacement given that a sizable chunk of their kids majored in things like underwater basket weaving. Gen-Z is much smaller and is really focused on tech jobs, they are not going to make up the numbers. Where are you going to make up the shortfall? (BTW I understand that this is the Peter Zeihan POV).

The US is not constrained by labor supply in the slightest. The basket weaving comment is inaccurate, irrelevant, and mostly just jaded cynicism. Gen Z is not focused on tech jobs either to any sort of meaningful extent that we can’t build up manufacturing.

If the US needs to make up a shortfall, it will simply open up immigration more.

Good manufacturing jobs tend to be pretty good.

> will simply open up immigration more

It’s not so simple when the labor crunch is being felt in vast regions of the globe and many (most?) developing nations are aging faster than the US and are older on average or will be over the next 10 - 20 years.

When your per capita GDP is 2-4x higher than surrounding nations you're looking to draw from it absolutely is.

If the relatively young population segments we’d need to draw from are in rapid decline, as they are across the western hemisphere then it doesn’t matter how much cash we have if there’s no one left to emigrate here.

You get it. There will be a serious labor crunch over the next few years as boomers continue to retire and immigrations fails to make up the numbers. Maybe massive re-training programs to get aging millennials into in-demand fields? Zeihan essentially says that while the US will still be in the best position it will still be painful and to just accept the pain until Gen Alpha comes online in 20-30 years. I don't buy this part of his thesis. Will millennials produce the number of kids needed to offset their losses?

> Will millennials produce the number of kids needed to offset their losses?

Yeah, this seems very doubtful. High housing cost + large student loan debt has delayed family formation which means fewer kids.

That’s not the case though. There will absolutely be enough people to import a full labor force for the US for a very long time.

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