You are absolutely right. Those countries are a 3rd world watering hole. That's hilarious by the way. I'm going to remember that. Those countries are also a banana republic but I would also argue the way our country is being run from the executive branch that we too are also a banana republic.
As far as the U.S. as a world currency lets don't forget that there is a few others as well.
1. Pound Sterling
2. Japanese Yen
3. Swiss Franc
4. Canadian Dollar
5. Euro
6. Chinese Yuan
The United Nation has already said they want to abandon the Dollar. Russia and Iran have abandoned the Dollar. The Chinese have said they don't want to make any more foreign exchange reserve of any paper currency, because all the paper currencies are government debt currencies. But you are right on the other points. Our bond market is large and every year our government has to sell more to fund that growing debt. We do have a commercial and industrial base.
I never said the U.S. would whimper and die because they issue fiat currency. I do know for a fact that countries that keep printing massive amounts of currency to try and fix problems eventually suffer through very bad inflation with their currencies falling.
The answer to your question about the rest of the world, they will suffer also. The East in my opinion will suffer the least if they do suffer. I believe that China is going to back their currency with gold.
Finally, it will not take a leap of faith for gold to overtake U.S. capital markets. When the Great Depression hit people were trading in their paper dollars for Gold. The treasury was begging the Fed to raise interest rates to raise the value of the dollar because they feared they would run out of gold.
I have know idea how high PM will go. I do have a really good feeling they will break through their all time highs. At the moment I would rather own PM's than the Dollar.
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