Brendan Greeley

Well, it turns out that over the course of the late 20th century, starting quietly in the 50s, and then it becomes this system by the 70s,

Banks in Europe were marking up their own ledgers with dollars.

They were just manufacturing dollars the same way American banks do it.

You guys know this story.

My point is once you recognize that the banks just do it on their own and the country is trying to catch up, you end up with this system I think far more important than aircraft carriers are swap lines.

to the dollar.

I don't think that the dollar is a product of Pax Americana.

I think it is the product of if you have dollars abroad on your on your balance sheet and you're not an American bank, you're not subject to American regulation.

You're not subject to American charters.

We've got no control over you whatsoever.

However,

In a panic, you guys know this.

I just want to make the point clear.

The Federal Reserve will step in and swap dollars with your central bank so your central bank can swap them temporarily for you.

So that liquidity is sitting on your balance sheet and you can make your own dollars whole again with American dollars from the Federal Reserve.

That to me doesn't say the Fed is the origin of dollars.

That to me says anybody can create a dollar.

And if you're important enough to the Fed, they'll say, you know what?

It is a dollar.

We're going to make sure that that doesn't blow up.