The dollar is the world's go-to currency. But for how much longer? Will the dollar's status as the only true global currency be irreparably damaged by the battle in the U.S. Congress over raising the federal government's debt ceiling? Is the dollar's "exorbitant privilege" as the world's main reserve currency truly at risk?
To be sure, the purveyors of dollar doom and gloom have cried wolf before. When the subprime-mortgage crisis hit, it was widely predicted that the dollar would suffer. In fact, the greenback strengthened as investors seeking a safe haven rushed into U.S. Treasury bonds.
A year later, when Lehman Brothers failed, the dollar benefited from the safe-haven effect yet again.