SOS US Dollar vs toilet paper

There were many articles written on the US Dollar will collapse after all the QE after 2008.  6 years after, 2014, there is no sign of collapse and many experts continue to make such theory that US Dollar will one day become toilet papers.

This is actually a trillion dollar questions.  Will US Dollar become toilet one day.  Can the experts be right.  They have all the arguments and facts and logic behind it, but today, it stays as strong as what is 2008 against the Euro, at least.

US Dollar is widely used.  This is a fact.  Petrol dollar, how much transacted in USD? When Iraq, threaten to used Euro to transact petrol in Euro, Iraq is invaded and torn apart.  When Libya threaten to use Euro  to transact in Euro, Gaddhafi is assassinated and Libya has a new leader.  Any country that do not toll the line, they will be wipe off.

So, besides oil, what else is mainly traded in USD?  Don't forget, forex trading, traded about USD3 trillion a day, all done in USD, who can actually replace it?  Not China, not Europe, not Japan, not any country actually.

Yes, not even gold can replace USDollar.

I am not an expert, but I believe the argument made by Robert Prechter and Gary Shilling are correct.  Their line of argument is correct.  US Dollar is like a commodity widely used in the WORLD.  Whether you like it or not, it is not easy to be replaced.  They were talking about Bitcoins etc. The answer is UNLIKELY.

Here is why, America has issue Trillions of DEBT.  This DEBT will gradually become BAD.  This DEBT amounted to more than USD100 trillions.  A lot of it will turn BAD, i.e. non performing loan, gradually over the years, and each DEBT issued must be accounted for, either by the lenders or the borrowers.  Gary Shilling called it in his booked called, THE AGE OF DELEVERAGING.

Gary said that these trillions will be gradually wipe off the market.  That means this US Dollar debt ISSUED to the borrowers, will become NON PERFORMING, hence, trillions of US Dollars supplied to the market will be wipe off vs the printing of US Dollar, the dollar that turn bad is far HIGHER than the printing of new US Dollar to a tune of more than 10 times.  Hence, the AGE of DELEVERAGING argue that US Dollar in fact will become stronger over the years, against other major currency like Euro.

Similarly, after 2008, not only US has inject trillions into the market, so is Euro, so is China, so is Japan.  The concept remain the same, US Dollar in the MARKET cannot be replaced, period.  So, the proponent that US Dollar will become toilet paper, sadly, will not come true.  So, majority will be shock in future to find out that US dollar become stronger instead.

This may not be what majority wants to hear, but it is the most logical deduction.  US Dollar, is a commodity, that is supplied to the market in most transactions.  I have not mentioned derivatives, mainly transacted in US Dollars, comes to a tune of USD600 trillions, 10 times the world GDP.  You tell me, who can replace this much of toilet papers?