What is the basis of currency value? Anyone who understands foreign exchange knowledge knows that the essence of whether a country’s currency is strong in the end-maintaining an upward trend is still that its labor force value ratio is higher than that of other countries. In the new economic era, the so-called labor force value The price comparison mainly refers to the difference in the growth trend of labor productivity, that is, the proportion of the value created by innovative labor in GDP. At the same time, a country’s resource reserves have a great impact on the strength of the country’s currency, especially in an era of increasing global resource shortages. This is also the fundamental reason why the currencies of some resource-exporting countries always rise. The last and most important point is that the currency, to some extent, represents the country, and a strong currency makes the country strong. If the country is united, the political power is stable, and labor productivity continues to rise, the country’s currency can remain strong; on the contrary, if a The country often fights, and often uses force abroad. If the country’s financial resources are not used, the country’s currency will have problems.
In this sense, the U.S. dollar is either a success or a failure. Although there is no possibility of collapse for a while, if it wants to become stronger, it must withdraw its troops from Iraq. Its meaning is the same as entering the market to know the difference between A shares and B shares. The euro also has problems, and the pound also has problems. World politics is very uncertain, terrorist attacks, ethnic conflicts, local wars and so on. Generally speaking, there are some well-known safe-haven currencies in the world, such as the Swiss franc and the Japanese yen. Due to the strong absorption capacity of the US dollar, the possibility of war in the United States is very small. Therefore, the US dollar often becomes the currency of choice when major global risk events occur. The best risk currency. For example, when there is a global financial crisis, the dollar will inevitably rise sharply.
Another important reason for the strength of a currency is the choice of global foreign exchange reserves. The so-called “ancient” currency of the US dollar also means that the US dollar accounts for a large proportion of the foreign exchange reserves of all countries in the world, so the downward trend will be more prominent within a certain period of time. A large part of the recent dollar decline has been due to a reduction in the value of the greenback. However, since the U.S. capital markets such as bonds and stocks are still the most efficient in the world, and the U.S. dollar still accounts for 70% of global trade settlements, it is impossible for central banks to significantly reduce U.S. dollar reserves Therefore, reducing the US dollar reserve may not be the best choice at the current possible time.
