Why Elizabeth Warren is right about currency values?

OnlyLiveTrades posted:
US unemployment rate at 3.6 is already considered full employment. It will not go down to zero to be considered fill employment.

if you are country, how to you prove that you are rich? e.g. if China says that they have a hundred shopping mall size warehouse full of Yuans. Do you think they are rich? vs If they say they hold a trillium worth of US bonds or a few shopping mall full of gold. With Yuans, China can print it themselves, you won;'t trust their value.

Why would a country choose US bond vs gold? Gold needs a a place to store them and is not easy to convert to cash. Most countries hold their gold in Fort Knox. They get a piece of paper that says they have X amount of gold at fort knox. They can sell this piece of paper to get cash. No actual gold needs to move from Fort Knox. (no different than you transferring money via internet banking to someone, no physical cash takes place, unless the recipients wants the cash, he goes to the bank.)

Why would you hold US bonds vs Yen etc. Firstly, US currency is highly liquid. Ask any citizen of any country what their value of the currency vs USD, they can tell you. But they will need to look it up vs Yen.

Secondly, US is the biggest economy. Why would you hold CHF instead of USD? Chances are a country has trade with US more than CHF (unless you are a Swiss neighbour). So guarding your currency against USD is more important.

A lot of countries trade with China too, but Yuan is controlled by a Communist regime, they can make you holding worthless if they want to and you cannot easily move /cash out your paper bonds. So holding Chinese Yuan is a no-no. Most Chinese supplier prefer to be paid in USD.