Who might get stranded by US currency risk?

Dollar seigniorage is more powerful than ever

clock • 3 min read
Richard de Lisle of the VT De Lisle America fund

Richard de Lisle of the VT De Lisle America fund

The Democrats are wedded to Modern Monetary Theory (MMT).

They want to put America back to work and this doctrine is the way to go. It is Keynesian with the addition of seigniorage and is compelling for our times. Seigniorage is government profit made from issuing currency, especially the difference between the face value of notes and coins and their production costs - that is, the benefit that accrues to the money issuer which currency holders bestow by not receiving interest on their holdings. Ever since President Nixon suspended gold convertibility 50 years ago, the dollar has depended on the kindness of strangers to support its value....

To continue reading this article...

Join Investment Week

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now


Already an Investment Week