Triffin Dilemma and Greek Debt Crisis 💵 #money #monetarypolicy

The Triffin Dilemma is a consequence of the US dollar, a local currency", being used as an international currency for world trade and investments. This violates the 4th Rule of Value which is about fair exchange. The US dollar is oppressive for undeveloped countries with low productivity relative to the US. But it is oppressive to the US when used by more productive countries like China and Japan. This naturally creates a trade deficit in the US. This is why the US forced Japan to devalue its currency through the Plaza accord and has imposed tariffs against China. The US dollar as international currency would only make sense if all countries had the same level of productivity. This mismatch was also seen in the Greek Debt Crisis where Greece was far less productive than Germany yet using the same currency. This caused Greece to have so much debt relative to Germany just like how the US has a huge debt relative to China.

Added 9 Jul 2026