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WHY THE US DOLLAR MAY BE DECLINING:
FIRST: “The growing deficit is the GREATEST obstacle to the dollar."
CNBC reports that a HIGH GOVERNMENT DEFICIT results in excess money printing, which increases inflation, and devalues the existing currency that we have in circulation.
The OTHER concern, as brought up by the economist, Steven Roach, is that the the US has an extremely low savings rate - so, in times of economic hardship - we have to borrow the difference from foreign nations who lend us their savings to get us through.
SECOND: A WEAKENING DOLLAR.
This money is tracked against 3 different metrics: The first is the EXCHANGE RATE to OTHER CURRENCIES, the SECOND is the demand 10-year treasury notes, and the THIRD is known as the “foreign currency reserves,” which is a fancy way of saying: how many US dollars are held by other countries?
THIRD: No “Reserve Currency Status” has has lasted more than 80-120 years - leading to the fear, the US dollar won’t last indefinitely, either.
That’s why EXPERTS say that - as of right now - even though the dollar’s future LOOKS uncertain - there’s really not much RISK, because - in order to lose its status as the “Reserve Currency,” there must be something else to take its place - of which, there are no other close contenders.
To put your mind at ease, a little more - when a Charles Schwab analyst looked at this even further…they concluded that, still, the US dollar is used in 40% of global trade, and almost 80% of all cross-border transactions. And today - the US dollar has held roughly the same value since 1987, proving to be a good “flight to safety” throughout worldwide turmoil.
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What's up guys, it's graham here, so apparently a lot can change and quickly, because in april of 2020 cbc posted a video titled. Why is the us dollar so powerful only to post a follow-up two years later with a new headline? Why the us dollar may be in danger. This, of course, is mirrored by cnn. The wall street journal abc and even discussed by investopedia.

Making, you wonder, is the us dollar actually in danger, and if so, what could we do about it? After all, on the surface, the u.s national debt just recently surpassed 30 trillion dollars. The annual deficit continues growing, larger and larger, and the popularity of the dollar has been on a slow decline for more than 20 years. So let's talk about exactly what this means. How a declining dollar would not only affect you, but also the entire economy, and whether or not this is even a big deal, because i have fun taking headlines like this breaking them down even further and then getting the unbiased truth of.

What's going on. Since honestly, they do have a point and it is kind of concerning, but before we go into that, i have to warn you. The like button is also in danger of not being smashed for the youtube algorithm. So if you wouldn't mind just giving it a gentle tap and subscribing, if you haven't done that already, it would help me out tremendously, and hopefully these videos will help make you more money.

So, thank you guys so much and now with that said, let's begin all right. So it's a quick 90 second recap to bring all of you guys up to speed with what's going on as of now and for the last 80 years, the us dollar has been the most powerful currency in the world because it's known as what's called a reserve Currency, this refers to a currency, that's accepted throughout the entire world and since 1945 the us dollar has taken that place because of its resiliency lack of volatility and safety. When this system was first adopted, it was used as a way to keep the price of investments. Commodities like gold and oil and exchange rates stable, see when you have dozens of countries, all trading goods and services with each other.

It helps to have one universal currency, accepted everywhere, with the predictable value to conduct those transactions. Otherwise, you run the risk of getting paid in another currency that could be difficult to exchange and by the time you're able to convert it back to your native currency. It may have just tanked in value so think of this, like a global transfer of value through the us dollar, that everyone is universally agreed to be safe or for all my crypto fans out there, it's no different than using a stablecoin to move money. From one token to another, without the price of whatever token crashing into the oblivion, as soon as you buy it, except in this case, it's with the us dollar.

Of course, the united states benefits from this as well, because there's more global demand for its currency, more countries hold those dollars and, as a result of that excess demand, we have extra buying power, but as cnbc reports, the value of the dollar could be in danger. So we need to investigate and go down the rabbit hole to figure out. Why? First they say that the growing deficit is the greatest threat to the us dollar and if you look closely at the numbers, i'm about to show you, you will be shocked. That's because the united states operates a bit like a business in the sense that it draws money from taxpayers and exports and then spends that money on the systems that keep it growing or in more literal terms, the federal government collected four trillion dollars of revenue in 2021 and they spent 6.8 trillion dollars, wait what yeah! For the last 20 years, the us federal government has operated on a deficit, meaning they spend more money than they make.
In fact, the last time that we had any surplus whatsoever was all the way back. In 2001, so what's going on well yeah, it's no surprise that over time the united states has spent way more money than it makes, and now the national debt has ballooned to over 30 trillion dollars. Of course, this is not the first time the national debt has been called into the spotlight having increased consistently since the late 1800s, but as a sore spot for the us dollar. Cnbc reports that a high government deficit results in excess money, printing, which increases inflation and devalues the existing currency that we have in circulation.

It would be no different than having one pie with four slices. Only to have the government give people more slices by taking the existing pie and cutting it up even further. The other concern brought up by the economist, stephen roach, is that the us has an extremely low savings rate. So, in times of economic hardship, we have to borrow money from foreign nations who lend us their savings to get us through unless, of course, something happens and they evaluate, should we be giving them more money.

So, realistically, is this something that could actually happen well before we answer that the second impact to a declining currency is a weakening dollar see. The dollar is not just valued at one dollar, even though technically a dollar is always going to be a dollar, but instead this money is tracked through three different metrics. The first is the exchange rate to other currencies. The second is the demand for 10-year treasury notes, and the third is what's known as the foreign currency reserves, which is a fancy way of saying how many of these dollars are held by other countries now right off the bat when people think of a weakening dollar.

It's no surprise that a dollar today is worth significantly less than it was back in the 1950s, so we already have a currency, that's worth less and less the more if it gets printed. But in this context, a weakening dollar is a lot more important because it not only affects you but also global demand in terms of how much this could buy. But when it comes to the exchange rates to other countries. It is true that the value of the us dollar has been gradually weakening since 2020..
However, recently the us dollar strengthened again as investors look for a safe haven asset during times of global uncertainty, the second, as far as demand for treasury notes. This is essentially giving the us government a 10-year loan and for people who want a safe place to store their money. They'll buy these and then get a predictable return on their capital. But recently, though, the dollar has been actually going up, alongside with interest rates, meaning the higher the rates go, the more interest there is in higher yielding bonds, and that in turn, helps boost up the dollar.

However, third, in terms of foreign currency reserves, this is where things start looking a little bit less optimistic because, as you can see, the us dollar has been steadily declining, as other currencies are beginning to take its place and as cnbc reports we're now at the lowest Level in 25 years now, of course, on the bright side, a weaker dollar could actually be beneficial for the us economy, because our own exports cost less for other countries to purchase, and that can help boost demand. Although on the flip side, imported goods would then cost more because their dollar buys less and alongside that, inflation could look worse because it costs more money to buy the exact same things and third, no reserve currency status has ever lasted for more than 80 to 120 Years leading to the fear that maybe the us dollar won't last indefinitely either. For example, france held the reserve currency from 1720 to 1815.. However, over time they continually ran into deficit and spent more money than they made that led to a lowering of interest rates and then eventually reissuing even more currency to keep up with demand, even though initially it was a big boom to the economy over time, it Devalued their money, and within 10 years, the world had lost faith in france's reserve currency and they moved on to.

Instead, the british pound, which held the reserve currency from 1815 to 1920. during the time that france was economically declining. Britain was quickly becoming one of the world's largest economies. London was the center of international trade and, as a result, the entire world was already using their currency.

Although after world war, one, the uk went through a time of economic depression, slowing growth and deflation, eventually leading them to abandon the gold standard and the eventual u.s reserve currency, which started officially in 1944 and is lasting until who knows when prior to then the united States grew to the point of becoming the world's largest economy by 1920, during a time where other countries were abandoning the gold standard to pay for the cost of world war one. But by the time world war ii occurred, the u.s was in a position to supply weapons and goods to other countries which were later repaid back with gold, giving them, of course, the leverage to become the world's reserve currency from that point on, instead of buying gold. Other countries would purchase u.s treasuries as a safe store of value. However, with the rising national debt, high inflation and declining global reserves of u.s dollars is our money actually in danger, or is this another fear-mongering headline with no chance of actually happening, although before we go into that, since a lot of people are turning to alternative assets? During times of uncertainty, if you're looking to buy, sell track or trade, a multitude of cryptocurrencies and nfts all in one place with fees that are up to 85 percent lower than the top competitors, then our sponsor ftxus is here to help they're one of the largest U.S regulated cryptocurrency exchanges in the world with millions of users founded by sam bakeman, freed one of the wealthiest people in the world under the age of 30, who plans to give 99 of his money away to charity with the ftx apps, you could buy and sell Cryptocurrency with no fixed minimum fees on transactions, no ach fees and no gas fees for the top ethereum and solana collections.
I also love how you could track the prices throughout more than 10 000 different options, and you can take my personal favorite approach by setting up an automatic, recurring deposit to dollar cost average into the markets on a regular basis, not to mention their debit card is Accepted throughout millions of merchants worldwide, and now you can sign up with my link down below in the description with the code gram and get all the way up to a hundred dollars worth of free crypto, depending on how much you trade. So if you're interested in signing up or learning more feel free to use my link down below in the description to get started today, and now with that said, let's get back to the video. Well then, as i mentioned earlier, now is the perfect time to bring up the national debt, which, as of right now, stands at just over 30 trillion dollars in terms of just how massive that number is that's enough to pay off everyone's mortgage plus have enough leftover To pay off all outstanding student loan balances and auto loans and give everyone in the united states a 25 000 check, so it's 30 trillion dollars anything to worry about, and could that collapse the dollar? Well, unlike a person who should only spend money that they have available in the checking account, a country works completely differently and they often finance their operations to continue growing. It would be kind of like a person taking out a student loan, knowing that if they spend ten thousand dollars today, they can make fifty thousand dollars or more in the future, except with the united states.

They could keep borrowing and borrowing and borrowing sometimes for completely pointless random stuff. So is that a problem - and the answer is well kind of when we look at our debt in relation to how much money we make we're actually a lot lower than quite a few other countries. You can see here that sure we might owe the most amount of money, but we also make quite a lot of money as well and when you factor in the debt to income ratio, you could see where we are here. It's like someone taking out a 3 million mortgage which, to some people, sounds crazy until you realize that person is worth 20 million dollars and a 3 million mortgage is the same amount that they make in a year.
So the amount of debt that we're taking on relative to the amount that we own as a country is still relatively small, even though the number itself is high and really because of that for better or worse, there's, no real reason to pay off the national debt. Early if ever, however, where i see the biggest obstacle, is if people stop investing in the united states and we stop growing like we have been, then the united states will be forced to pay a higher interest rate on their debt, to entice more people to invest And that in turn would almost certainly lead to trouble in the future. That's why experts say that as of right now, even though the dollar's future looks uncertain, there's not a lot of risk because, in order to lose its status as the reserve currency, there has to be another contender to take its place, of which there's nothing. That's coming close, so obviously the fact that 80 of all us dollars were printed in the last 22 months, combined with 64 of americans now living paycheck to paycheck.

Well, china's economy is poised to outpace the us by 2030, isn't exactly confidence inspiring, but by and large, a lot needs to happen first, if there is to be a new reserve currency and notwithstanding a massive black swan event that would undermine the united states role in Worldwide trade, it might not happen, or it might not happen during a time that any of us could reasonably predict to put your mind at ease. Even more a char schwab. Analysts looked at this even further and they concluded that still the us dollar is used in 40 percent of global trade into almost 80 percent of all cross-border transactions, and today the us dollar has held roughly the same value since 1987, proving it to be a good Flight to safety during times of economic turmoil, so as much credit as i'd like to give for this, and i do think that it has some merit over the next 100 years realistically in the short term, i would not worry about the demise of the us dollar. Not to mention if it did collapse or even lose a significant amount of value, it would also impact every other country that holds their reserves in u.s dollars as well.

That's why i don't think there's a major issue to worry about. The us dollar is still the top option and instead i would focus on what you can control like getting a free stock down below in the description when you sign up for public using the code, graham because that could be worth all the way up to a Thousand dollars, so thank you guys so much for watching. I really appreciate it also make sure to subscribe, feel free to add me on instagram and also feel free to sign up for ftx us down below in the description, because they will give you all the way up to a hundred dollars in free crypto. Just for signing up and making your first trade, so if you're interested all the links are down below in the description.
Thank you guys so much for watching and until next time.

By Stock Chat

where the coffee is hot and so is the chat

28 thoughts on “Stop saving money the dollar crisis just got worse”
  1. Avataaar/Circle Created with python_avatars Craig Walenta says:

    The concept that a reserve currency can only lose its status if another reserve currency takes its place is false. A country could just hold its own currency, other countries are not going to opt to hold dollars and pay the inflation tax on them just because no other currency looks good. If they need dollars to transact, well just buy them as you need them.

  2. Avataaar/Circle Created with python_avatars John O'brien says:

    Let’s hope the world of finance goes into a massive crash and everyone ends up with nothing and anarchy prevails we will see who the strongest are then.

  3. Avataaar/Circle Created with python_avatars James Krejci says:

    “Stop saving money” —- talking to his audience that mostly lives in poverty and their savings might last three to six months in a case of having to use it to survive. Yet he has millions and we are the issue.

  4. Avataaar/Circle Created with python_avatars VK RGFAN says:

    The US dollar was used as a weapon against Russia, so other countries took a note of that specifically China, India and Saudi Arabia. They will diversify and trade in their own currencies, the new payment system is already in the works.
    The greed and corruption are unsustainable, other countries see how the U.S. exploit undeveloped nations.
    When you subsidize monopolies but don’t invest in basic needs such as healthcare and education eventually things will start falling apart.
    I mean in the last decade or so the only profitable business was real estate, that’s not an indicator of healthy economy that’s an indicator of greed.

  5. Avataaar/Circle Created with python_avatars moe mann says:

    Fingerhut changed they name to fetti & closed everyone's Fingerhut accounts & put the new fetti name on the credit report as a new account & Fingerhut is on there as a closed account now which made my score go down, can you remove that since it's a name change they did or what?

  6. Avataaar/Circle Created with python_avatars Math Meets Finance says:

    Graham, you should review my latest video. i compare the Roth IRA and 401k and give my opinion on which is better!

  7. Avataaar/Circle Created with python_avatars JGM AIRSOFT says:

    Hey Graham! I noticed, after all these money talks, I was wondering if you can make a video about CREDIT KARMA VS EXPERIAN. Which score is correct and such.

  8. Avataaar/Circle Created with python_avatars Henry Clinton says:

    You might not have a hundred million dollars to invest, but that doesn’t mean your money can’t share in the same opportunities available to others. You work hard for your money; make sure your money works hard for you.

  9. Avataaar/Circle Created with python_avatars Mark Anderson says:

    Most people are so poor that all they have is money, invest some of it no matter how small, when you invest you are buying a day that you don't have to work.

  10. Avataaar/Circle Created with python_avatars Sunny_Koufax says:

    My man Stephan Graham getting so much ad revenue his videos are essentially ad montages not nearly as educational as they used to be lol good for him though

  11. Avataaar/Circle Created with python_avatars Alexis Frias says:

    the economy is gonna crash forcing us to be dependent of the government, and they are only feeding those who got jabbed

  12. Avataaar/Circle Created with python_avatars All2skitzd says:

    This is why voting is important. Try watching the news and the world if you really want to know how bad it is.

  13. Avataaar/Circle Created with python_avatars RememberTheLord says:

    It’s getting to the point where I read you or MeetKevin’s video title and assume the opposite because of how bad the clickbait titles are and how they’re never related to what you guys write. :/
    Why not title this “DON’T STRESS, THE USD WILL LIKELY STILL THRIVE!” Or something.

  14. Avataaar/Circle Created with python_avatars Old Bastard1973 says:

    The system has nothing that I want . . . . . so why buy . . . . . . my purchases are geared towards the collapse .

  15. Avataaar/Circle Created with python_avatars akshay kumar says:

    Damn I used to watch his channel, back when it was dry but still valuable. It was better back then.

  16. Avataaar/Circle Created with python_avatars Deez Nuts says:

    Buy silver and gold it holds actual value it’s not fake and virtual it can’t be printed inflation is a tax

  17. Avataaar/Circle Created with python_avatars Kronos says:

    Is buying the s&p 500 still the way to go as we go into uncharted territory for the market and economy? I have just been DCAing into that as my strategy mainly.

  18. Avataaar/Circle Created with python_avatars A S says:

    When Dalio said cash is trash that didn't age well. You haven't experience a massive down turn I hope you're prepared. It will probably last a while.

  19. Avataaar/Circle Created with python_avatars matthewbdelier says:

    I think you're a sharp guy but the dollar is a Saudi decision away from implosion. If the Saudi's decide to sell oil in Chinese Yuan or Russian Rubles, or Russia sells oil in Rubles, likely scenarios in the next few years. Any of those = catatrosphic failure of US $ and US economy. This is what the WEF and Klaus Schwabb want to happen. Called the Petrodollar. The last country to try to sell oil in currency other than US $ was Iraq…ask Saddam how that worked out. Now Putin is trying the same. But the kleptocrats in Washington need the Petrodollar…WWIII is already started.

  20. Avataaar/Circle Created with python_avatars Bryan Villanueva says:

    US owing trillions of $ to the federal reserve which they also control. It only means they can borrow limitless money.

  21. Avataaar/Circle Created with python_avatars Thomas Brian says:

    The difference between a Rich person and a Poor person is how they use their time. Your Future is created by what you do Today not your Tomorrow.

  22. Avataaar/Circle Created with python_avatars Brendan Smith says:

    The dollar index is almost at an all time high now, meaning it's very strong relative to other currencies.

  23. Avataaar/Circle Created with python_avatars AZBat says:

    Can you do a video on corporate landlords? Seems like they are consuming all the inventory and driving prices up. This makes their portfolios look great, especially if they are publicly traded. What has to happen for them to start unloading their inventory of homes? This is where most of the home inventory is. Don’t see any videos about this.

  24. Avataaar/Circle Created with python_avatars Lou says:

    I think you may be missing how the national debt really works. The debt is really just inflation that capture in domestic assets and export via the trade deficit.

  25. Avataaar/Circle Created with python_avatars harmony connie says:

    My advice to new investors: Buy good companies stocks and hold them as long as they are good companies. Just do this and ignore the forecasts and market views which are at best entertaining but completely useless

  26. Avataaar/Circle Created with python_avatars SlickTalkTV says:

    Hey Graham I’m really interested to know if you could reveal how much you were getting paid at the very beginning of starting working with that realtor you mentioned in the millennial money episode yesterday

  27. Avataaar/Circle Created with python_avatars Janet Gibson says:

    I will forever appreciate this channel and Mrs Alece Moore, you've helped my family alot, your videos, advice, lessons and funny words are inspirational and helpful to us. My husband and I have been able to be minimal, conscious in spending, saving and investing wisely, I now earn every week. You're such a blessing to this generation. we all love you😘😘>>

  28. Avataaar/Circle Created with python_avatars bassfella69 says:

    I went to all cash a year ago. If I had left it in the market I would be down 50 to 80 percent right now on my investments and more than a little depressed. Soooo, I think I’m gonna just go ahead and save for awhile.

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