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Comment by wunderland | Hacker News Reader

Capital flight will decrease (in the medium term, like by the end of the decade) as US Dollar dominance diminishes. Oil trades between China-Russia-India are now denominated in Rupee-Rubles or Renminbi-Rubles starting only this past year, and so the groundwork is already laid.

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Maybe. But that’s not how it has worked in the past. In other cases capital controls like this cause international businesses to not trade in the currency and to instead demand other currencies to settle accounts, causing more capital flight.

There is an example in the article of an investor with money stuck in China. They won’t be doing as much investment as they would if the currency was liberal for instance.

The western currencies dominate foreign trade for lots of reasons, but the biggest by far is that they are easy to move.

Why would USD dominance diminish? Something like 90% of IP is based out of the US. Chinese education system is a complete joke (as evidence by brain drain).

Because having a global reserve currency strongly relies on network effects and USD share in international trade is failing steadily?

How much of this IP heap is an utter trash like software patents and patents on black rectangles generated just to be added to a patent pool? From my (surface-level) understanding school-level education in the US has much bigger troubles compared to China, but luckily for the US it gets compensated (for now) by sucking brains from all over the world into the well established system of universities.

And it's not like China has no experience with playing extremely loosely with IP laws.

You sound very anti-American.

USD share of global forex reserves has been declining for two decades, but it is still used more than all other currencies combined.

Here is a good article by the IMF that gets into how various central banks are diversifying their reserves into a broader range of currencies. https://www.imf.org/en/Blogs/Articles/2022/06/01/blog-dollar...

EUR is all but finished. Chinese RMB is also set for significant depreciation as a direct result of international trade/manufacturing “rebalance” away from everything-made-in-China model. Only thing remaining is USD.

https://www.youtube.com/watch?v=LiR54FPQiCs

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