If country A wants things from country B, country A has pay for it in country B's currency. Of course, only few countries can say I only pay US$ or Euros, take it or leave it. Money supply must be backup by size of economy and not the other way around. Which may lead to this... hyper inflation.
The 4 legs provide the power to move the cart. Human has only 2 legs and stand upright. So, it does not fit into our perception that human has to be behind the cart.
Every country that uses fiat money has to "print it." That's the origin of modern money. If they don't supply enough to their economies, they will have to print some more to avoid deflation. If they print too much, they can swap some of it for interest paying securities, or they can remove it from the economy by levying taxes. Some Countries (eg., the U.S., Japan, Canada, etc.) can print as much as they want, don't have to borrow and have no real debt. If they are smart the won't print faster then their economies can absorb the new money without too much inflation. And they won't tax so much that they cause recession or deflation. Countries whose currencies are unstable and not trusted by other countries may be forced to borrow in other countries currencies in order to carry out international commerce (eg., Turkey, Argentina, Ecuador, Russia, etc.) These countries have real debt. Countries like the U.S. sell bonds because they are needed both as a tool of the Central Bank and as an Interest paying store of money. Selling bonds creates the illusion of borrowing, but there is no real borrowing going on. In the case of the U.S., what's happening when the Treasury auctions securities is money that was "printed" and spent into the economy is being temporarily taken out of bank reserve accounts and put on ice in the form of securities. Later the Fed can put this money back into circulation, if it deems it necessary, by buying the securities back. Only the Congress can authorize the removal of money from the economy without replacing it with a government security. Congress uses taxes for this purpose. The U.S.A. always money finances its expenditures. It never borrows to pay for things. It only appears to borrow. When it appears to borrow what in effect it is doing is swapping money in its non-spendable interest paying form for money it previously printed and spent into the economy in its non-interest paying, spendable form.
Your entire explanation is I think what the politicians hope is the way that it will continue to work, but I'm not so sure. Do you not think that the change from stable to unstable can happen very quickly? And once you lose that stability, how do you get it back? When you read stuff like Russia wanting to price oil in something other than dollars, you have to wonder how close this change from stable to unstable is. When people realize that government bonds are earing easily -5% and higher in real yields, will this affect stability? If your own population doesn't want to hold the currency, is this moving one big step closer to instability?
%% Like the short seller noted\ fundamentals win in the end; i haven't even had to time to check out the evil empire or chicoms chart. US has had its debt downgraded once by S&P, looks like wall street is doing it also\\.......... But i like the way the Fed head Mr Powell warned in public about the US needing a budget+ our level of debt is not sustainable. Actually, if i was a printer [+i'm not \LOL]I would warn the overloaded credit card buyer once + then do the print job, even knowing one of the year$ the bank will cut off his credit card . Or force that overleveraged clown to pay up with a rate he neVer forgets. The good news is US capital markets work well + DAL sector is printing less airline tickets,................................................................
Indeed, it can happen quite rapidly. Monetary systems have always required good management with high integrity to remain stable and lasting. But there is another attribute that I believe is essential for long term stability and that is openness, meaning all the citizens of the country should understand correctly how the money they use is created, what gives it value, and what are the necessary constraints if the currency is to remain reasonably stable. At the same time they don't need to understand details of Central Bank and Treasury operation. Hopefully they will also understand why all capitalists countries use fractional reserve banking and the advantage that gives any economy. And too they should understand why we don't use a gold standard anymore and how a gold standard unnecessarily handicaps an economy. Unfortunately in the U.S. There is not one person in a hundred that correctly understands these things. Why is this? I don't no. But it does seem awfully convenient for politicians not to understand it, or pretend they don't.