Not at all.

It may not be optimal for certain reasons to use USD, and they'd lose some advantages, but there are others to be gained that might make it worth it.

To the extent there are no real capital controls on USD anywhere - and - the US Fed is separate from the government, then nobody is going to be a 'colony' of the US by using USD.

TIL Zimbabwe, Ecuador, El Salvador, Palau, East Timor and the British Virgin Islands are all "basically US colonies".

What about countries that don't use the dollar as currency directly, but keep a fixed exchange rate to the dollar - they would be paying the unseen tax of inflation too, right? With a fixed exchange rate if the dollar value falls, so will the value of their currency. So that would mean Hong Kong, Cuba, Jordan and the Netherlands are all "basically US colonies" too. (China may be kind of surprised about that first one.)

Does this work for other currencies, or just $USD? Are Martinique, Andorra, Montenegro and Kosovo "basically EU colonies"? - they all use the Euro as currency, but are not part of either the EU or the EEA.

We don't actually have to hypothesize about what would happen if an unstable economy switched everything over to dollars (or Euros), either directly or by exchange rate peg, because it has already happened, many times.

https://www.worlddata.info/currencies/usd-us-dollar.php

Montenegro and Ecuador are effective colonies in their most developed areas.

Most of the valuable property in major metros is owned directly by US-based or EU-based emigrees , who paid top dollar for property that has a ROC duration in excess of 20 years.

Most of the metro areas on these countries are rapidly turning hollow projects which cheap rents or undeveloped land. It is quickly becoming like paris.

Flat rental 2000 EUR. Buy price: 2M EUR.

When someone that is not a local is taking all your valuable land... Thats the textbook definition of colony

Your argument from incredulity doesn't make what I say less true. Maybe my language was a bit strong, but there's no denying if somebody can freely make more of something you value, then they're gaining from your use of said valuable.

Andorra is definitely a EU colony, or more precisely, a France/Spain colony used for fiscal evasion.

yes, calling them colonies are a stretch but there is a relation of dominance there, not just because of inflation but the whole credit system

This happens in many countries already, the inflation tax of the US banking system is 2% and not an issue. That does not make Panama or Hong Kong US colonies.

It makes them economically dependent. Explicit rather than implicit client states of the US. Colonies in all but name.

When President Arnulfo Arias tried exercising his nation's right to issue sovereign currency, he was deposed in a US-backed coup on October 2, 1941.

Switching from one currency you can’t control to another doesn’t sound good

Exactly. The Bitcoin folks like to point to a "shadow cabal" that controls US currency as though that same problem doesn't exist in Bitcoin's architecture. At least we know the names of everyone serving on the Federal Reserve's board.

Bitcoin, on the other hand, can be controlled by any miner or group of miners having over 50% of the network's hash rate[1]. We don't know the identities of the miners and we have seen them engage in political actions that change the behavior of the currency[2].

1. https://www.investopedia.com/terms/1/51-attack.asp

2. https://en.wikipedia.org/wiki/List_of_bitcoin_forks

That 2% number depends upon whether you trust the people inflating the USD to tell you what the inflation rate is.

Feel free to call shadowstats crazy, but nothing in it is false. It's just another perspective. http://www.shadowstats.com/alternate_data/inflation-charts

“Shadow government statistics” is indeed nutters and not all perspectives deserve equal footing.

asks for evidence, gets link with evidence, dismisses as "nutters" without addressing the evidence at all. He is showed you the CPI as calculated pre-1980 with a page explaining the changes in methodology and why they're flawed. How is that "nutters"? You aren't having a discussion in good faith.

You are right. The official inflation rate is wrong and misleading.

Why don’t you provide some data instead of conjecture. We generally don’t accept that the government inflation numbers are just plain wrong without substantiation.

Sometimes common sense trumps data.

You dont need data to know that the sky is blue.

That being said parent did not help himself throwing statements out there without a foundation.

Here is what i believe he should have said:

CPI for goods fails in the following:

Accounting for changes in sizes and quality of certain products (i.e. instead of raising prices vendor will lower quality or amount of product )

Accounting for healthcare costs is fundamentally flawed. This only factors out of pocket costs when the majority of americans are effectively paying 80% of healthcare premiums via reduced grosd wages in the form of "employer contributions"

Accounting for substitutions of products in the cpi itself which are not reliable substitutes, or the exclusion of certain items (housing) which are clearly inflationary.

There is also a lot of criticism made for the boskin commision changes https://en.m.wikipedia.org/wiki/Boskin_Commission to cpi which messed with base prices and thus with true measurement of cpi.

> Sometimes common sense trumps data.

Data always trumps common sense, that's why we have science :) - if science had a motto that would be it! Sometimes we need more data, but common sense is often trivially wrong.

I would argue we do in fact need data to show the sky is blue. The data shows us the sky is not in fact "blue" but rather a blend of various peaks and valleys of radiation. [2] It's not so much blue as a bunch of colors at once that happen to be blue-dominant. Further it’s actually the “inverse of blue” in that blue is allowed to pass but all the other colors are absorbed.

> Accounting for substitutions of products in the cpi itself which are not reliable substitutes, or the exclusion of certain items (housing) which are clearly inflationary.

Housing on a $/sqft basis has tracked inflation since the 1970s across the US. What's changed is zoning policy, but zoning policy isn't a function of money supply. [1]

A reduction in welfare is not necessarily inflation or monetary policy, it can just as easily be social policy. You can't pin all society's ills on the evil Fed and their consistent and predictable 2% rate of inflation.

> Accounting for healthcare costs is fundamentally flawed.

Healthcare costs exceed inflation. That's not a function of monetary policy, it's a function of a fundamentally flawed healthcare system in the US that needs to be fixed. That's not the Fed's job, that's social policy.

> There is also a lot of criticism made for the boskin commision changes https://en.m.wikipedia.org/wiki/Boskin_Commission to cpi which messed with base prices and thus with true measurement of cpi.

Peoples needs, wants and expectations change over time. In the same way the S&P 500 and Dow Jones cycle through companies that are no longer relevant, doing so with the CPI basket is the only rational thing to do. For instance, Caviar and Lobster used to be crap food for poor people -- they're crazy expensive now. Is that inflation? Of course not. Totally fair to eject them from the basket.

[1] https://fee.org/articles/new-homes-today-have-twice-the-squa...

[2] https://www.antenna-theory.com/tutorial/whyistheskyblue/purp...