Exclusive Interview: The Economist's Philip Coggan On The Fate Of The U.S. Dollar (And More)

by: Lou Basenese

"It's a thousand times more important than a nuclear bomb being tested in North Korea." That's what Michael Pento – of Pento Portfolio Strategies – said about preserving the U.S. dollar as the world's reserve currency. Yet, the Federal Reserve seems determined to make it an impossible task. Years of super low interest rates, combined with $3 trillion in fresh money printing, have almost every pundit convinced that the dollar is doomed.

And the stats don't leave much room for optimism, either.

  • After peaking in 2001 at 71.5%, the share of U.S. dollar holdings in global foreign exchange reserves is down to 61.9% today, according to International Monetary Fund data.
  • In terms of the dollar's percentage of total world money supply, it's plunged from nearly 90% in 1952 to about 15% now.

So is the demise of the dollar as the world's reserve currency truly inevitable? To get a fresh perspective on the topic, I sat down with Philip Coggan, an award-winning financial journalist who's now the Buttonwood Columnist at The Economist. He's also the author of the bestselling book, Paper Promises: Debt, Money and the New World Order.

He didn't disappoint, either. A student of history and all things financial, he surprised me by saying he doesn't "think the dollar is going to disappear as a reserve currency anytime soon." But he doesn't think it's going to reign supreme, either.

So what exactly does he expect? You'll have to listen in to find out!

I encourage you to do so, too, because Philip Coggan shares many other timely and actionable insights during the course of our discussion, including:

  • The ultimate fate of the euro.
  • The conditions that would bring about a "sharply rising dollar."
  • Whether or not a return to the gold standard is even possible.
  • And why we might only be "halfway through this [currency] crisis."

Toward the end of our conversation, he even shares one of the best assets to own when "real interest rates are negative and nominal interest rates are low." (Or in other words, right now.)

To find out for yourself, all you have to do is click on the image below. Or you can read the transcript here.

Exclusive Interview: The Economist