We're in completely uncharted economic waters with QE/ZIRP, and I can think of several scenarios where increasingly more insane central bank intervention decimates the value of currency:
-The decision is made to monetize the debt
-Another 2008-scenario prompts helicopter money
-A large enough minority of people simply lose faith in the monetary system and rapidly spend their dollars
All that being said, I don't think we're anywhere close to a hyperinflationary environment, and you can definitely have a problem with the Fed and our system of money sans hyperinflation worries.
There's another classic reason for hyperinflation, which is a collapse of export industries causing a trade balance collapse. You can't print foreign currency.
It's rather like the old joke about "I don't have to outrun the bear, I just have to outrun you": the US is only in trouble if its real economy falls behind.
(I'm not convinced of the importance of the petrodollar argument, especially given how spectacularly expensive the Iraq war was; it looks more like Cold War "sphere of influence" politics to me.)
This position conspiratorial and non-factual and has no sound logical basis.
Yes - the US does use some geopolitical muscle to protect the 'petrodollar' but there are clear and unambiguous facts that fly in the face of the notion that Iraq/Libya were petrodollar issues.
1) The petrodollar is important, but not an existential issue for the US. The USD is so deeply entrenched as a global currency, the transactional amount for USD for Oil is relatively small in comparison, moreover, nobody needs to hold dollars to buy Oil, they just need it to transact. The statement 'near infinite amount of demand' isn't remotely true.
2) The US can easily use basic diplomatic pressure to keep Saudi Arabia, Kuwait, and Norway in line. Outside of that - there is no real control. Iran, Russia et. al. can do as they please today.
3) Your argument is a little upside down: the US Fed is fighting deflation not inflation - meaning that the US would love to have some softening of the currency overall.
4) The US is not carrying debt anything like most unstable countries. People loan to the US not because they have faith in the petrodollar, but because they have faith that the US Gov will pay them back - which is ultimately a function of the health of the economy - and relatively speaking, it's good. Or at least compared to most places.
Your position takes a simple thing and turns it into the extreme: 'Because the US has a petrodollar - all it's wars and geostrategy revolve around this'. It's like saying 'look at the bad cop on the news' and surmising all cops are bad.
err, ok...
US, Canada, UK, ECB, Norway, Aussie, Sweden - do not print money to pay bills, as you find in Brazil, Venezuela, China, every African state, and a good chunk of the rest of the world.
Not the same thing at all. In fact - your very statement clearly indicates that it's not the same thing.
The US 'gets money' by taxation - and by selling bonds. Some of those bonds are later purchased by the Fed, using money printed by the Fed. That's how money gets into circulation.
In short: US currency is backed by US Government bonds. That's the 'asset' that backs US currency.
It's not 'money printing' - because the US Government has to issue debt in this case. Someone - somewhere - in the USA, Japan, China etc. has to actually lend the US money - at a certain interest rate in order for the transaction to happen.
So the US government does not print money. It just issues debt. The Fed's actions are a totally separate process.
Now - when Venezuela 'prints money' - it just does that. It literally just issues currency to itself to pay it's bills.
That is completely crazy. And that causes hyperinflation.
Not believing that there is any sound economic principle to validate your position, I checked your reference:
Your reference says nothing other than a few, very basic things about how the Fed is structured. It says absolutely nothing about the difference between 'raising debt + open market bond purchases' (how the fed does it) - vs. the hyperinflationairy issues related to governments that influence their central banks and basically print money.
So not only are you wrong - but your borderline lying by posting references that have nothing to do with anything.
In summary: aside from taxation, the US government generally can only raise money by issuing debt. They cannot print money willy nilly as they do in places like Brazil.
This is false.
A) 'Central Banks' existed long before the US Fed.
B) The FED is totally unique in the world in that it is 'privately owned/managed' - most Central Banks of the world are nationalized, and managed indirectly by the governing apparatus. The more advanced the state, the more it is independent.
Nobody is copying the US system - that said - the US system is 'de facto' pretty close to Bank of England, Canada, the ECB etc. in the sense that though the Fed is technically a private entity - the way it is managed is pretty close to how most good central banks are managed.
Hyperinflation always has the same causes:
+ Governments printing money to pay off debts
+ Governments grabbing private property causing a capital flight.
That's it, there's no magic to it.