Part 3 - Oil money

April 12, 2023 07:00 Sukrit Sunama Knowledge  

After the US floated the USD in 1979, two financial crises occurred - the Tom Yam Kung crisis that started because the Thai government could not control its currency, and the Dotcom bubble in 2000 that started because internet companies were overvalued. However, the USD still survived and is still used as a reserve currency in international trade. One reason for this is the petrodollar system, where OPEC decided to sell their oil only in USD in 1971. Every country that wants to buy oil now needs to exchange their currency with USD, making it hard to break this system as most countries need to buy oil to survive. This system strongly supports USD as a reserve currency, and it is the reason why America needs to declare war and send soldiers to the battlefield in central Asia.

From 2000 to 2022, the average price of a house in the US increased by 160% (, but household income only increased by 12% ( Some economists say that people in the current period are the poorest since America was founded because the price of houses has increased much faster than income. People from the previous three decades could buy their houses after working for a couple of years but not the last generation.

If I say that floating currency is not a good idea to manage a nation's money, I think I am correct. So, the question is, what should we do about money? This article suggests holding currency as little as possible and holding more assets that can keep their value, such as property, gold, and cryptocurrency.

In the next article, let's talk about the next generation of money - cryptocurrency. Why is it the future of money? Why should you learn about it? And how does it work?


Sukrit Sunama

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