What is the relationship between dollars and American debts? What is the difference?

If we can't continue to issue new debt to repay the old debt, the United States is bound to default on its debt. By then, the price of US Treasury bonds will drop sharply, and the market will also sell dollars in large quantities. The Fed can only buy bonds by issuing a large amount of money, which will lead to unprecedented inflation and further depreciation of the dollar.

U.S. stocks, dollars, U.S. debt and commodities, the four markets you mentioned. First of all, exclude US stocks and commodities, and look at US dollars and US debt first. The interest rates of US Treasury bonds and the Federal Reserve are the price tags of the real value of the US dollar. This is a monetary measure of the risk of holding dollars. Many times, this risk premium is negative, because holding money in the traditional sense is zero risk. Then, you should know that the US dollar is the pricing and settlement currency of the current world system. In other words, the dollar is the real currency, while other types of assets, including the national currency, are just? World stock market? Individual stocks in the market. And in bulk, that's it? Individual stocks? The blue chip inside. Because the development of human society is inseparable from resources, a person can live without a country or a nation, but he must consume resources.

At this point, you will understand the relationship between dollars and commodities, which is actually similar to the relationship between money and stock market. On the one hand, the potential rate of return on dollar assets has increased, and the bulk has naturally declined; The potential yield of dollar assets has declined, and it is natural for commodities to go bullish. On the other hand, the risk premium of holding dollars has increased, and the bulk is naturally borne; The risk premium of holding dollars is reduced, so it is natural to be bullish in batches. The dollar directly affects US debt and US stocks. Commodities are mainly influenced by the international market. Any big geography has a great influence on commodities. Do you know how to measure the risk premium of holding dollars?

Historically, the yield of US Treasury bonds is positively correlated with the US dollar, and a higher yield of US Treasury bonds often means a stronger US dollar. However, after the financial crisis, the interest rate was pushed down to a level close to zero, which also made the prices of cash (US dollars) and national debt close to each other. This means that repeated risk aversion makes investors pursue treasury bonds and currencies, which leads to a lower yield of treasury bonds and a stronger dollar. However, with the gradual normalization of interest rates, the relationship between the yield of government bonds and the dollar will be normalized again. As the market approaches the middle of 2065438+2005, the yields of US dollar and national debt will rise simultaneously.