Will The U.S. Dollar Collapse

The total collapse of the US dollar is an all to real possibility in the not to distant future. It will happen when the value of the U.S. dollar plummets to a value equivalent to almost zero. Anyone who is holding U.S. dollar assets would inevitably be compelled to sell them quickly, and at any cost. This would include any foreign government who operates a U.S. Treasury. It would also affect any foreign exchange futures traders. And of course all individual investors or holders of U.S. currency.
If or more likely when this crash takes place, all parties involved would likely be demanding alternative assets other than U.S. dollars. The collapse of the U.S. dollar would make everyone want to sell their U.S. dollars and denominated assets, and no one would be buying them which in turn would hurt the value even greater.
If this becomes a reality it would plummet the value to a near zero worth. It would make hyperinflation look like a walk in the park.
What Circumstances Could Bring About a Collapse?
Three things must presumably occur before the dollar could begin it's probably irreversible path to collapsing.

First of all there must be an underlying weakness and progressive instability. This situation is happening as I'm writing this post in 2017. The U.S. currency is undeniably weakening despite its increasing 25% against other currencies since 2014. But before that the U.S. dollar declined 54.7 percent against the euro between 2002 and 2012. What caused this? The main reason would be the tripling of the U.S. debt during that period, from $6 trillion to $15 trillion dollars. The debt today is even worse now at nearly $20 trillion Dollars. This now means that the “Debt-to-GDP” ratio is now more than 100 %. This dramatically increases the chances of the United States letting the dollar's value slide. In this scary reality it means it would be easier to repay its debt with an alternate currency, or put simply cheaper money.
Secondly there must be a viable alternative currency to take it's place as the main go to currency that everyone will need to switch to and buy. The U.S. dollar got it's strength based on its use as the world's reserve currency.
It became the reserve currency in 1973 when President Nixon made a controversial decision to abandon the gold standard that backed the value of the U.S. dollar. As the primary global currency, the U.S. dollar is still used for approximately 43 % of all cross-border global transactions. This means that central banks are required to hold U.S. dollars in their reserves to be able to pay for these transactions. As a consequence about 61 % of these foreign currency reserves hold U.S. dollars.

The second most influential currency after the U.S. dollar is of course the Euro. But it only comprises less than 30 % of central bank reserves. The damaging euro zone debt crisis greatly weakened the euro as a viable global currency contender.
China and others have since argued that there needs to be a new currency created to replace the U.S. dollar as the new global currency. A Chinese central banker named “Zhou Xiaochuan” has even trying to go one step further. He insists that the “Yuan” should replace the U.S.dollar to held maintain and further strengthen China's economic growth. China has every right to be concerned with the U.S. dollar's steady decline in value. This is because it is the largest foreign holder of U.S. Treasury’s in the world, and this would greatly depreciate it's major investment funds.
This now creates the question, could bitcoin replace the U.S. dollar as the new world currency? In all seriousness it does have many potential benefits. 1. It is not controlled by any one country or one central bank. 2. It needs to be created, managed, and spent online. 3. It is already accepted at many brick and mortar stores around the world. 4. It has a finite supply. 5. It appeals to those who would rather have a currency that is backed by something concrete, such as gold.
But there are major obstacles in the way before it can become a one world currency. Firstly its value is extremely volatile. That is because there is no central bank or monitoring system to manage it. Second, it has become a chosen payment for perpetrators of illegal activities on the dark web which has tarnished it's reputation. It is also vulnerable to tampering from unknown forces.

The third and most unlikely occurrence that is needed for the U.S. dollar to completely collapse is a huge economic triggering event that destroys confidence in the dollar.
If major holders of U.S. currency such as China and Japan started dumping their holdings of treasury notes on to the market, then this could cause a major market panic which could lead to a collapse. China owns $1 trillion in U.S. Treasury notes. Why? because China pegs the yuan to the U.S dollar. This helps to keep the prices of its exports to the United States relatively cheap. Japan also owns more than $1 trillion in Treasury notes. Therefore it would also prefer to keep the yen low to stimulate their exports to the United States. Japan is aiming to move out of a 15 year deflationary cycle.
So would China and Japan ever dump their dollars? Extremely unlikely but if they saw their holdings declining rapidly in value and they had an alternative export market to replace the United States then it's a possibility. In essence the economies of Japan and China are greatly dependent on the U.S. consumers. They know that if they sell their dollars, that would further depress the value of the dollar. That means their products, still priced in yuan and yen, will cost alot more in the United States, and therefore their economies would suffer from this. At this present moment it's still in their own best interest to hold onto their U.S. Dollar reserves.
China and Japan are of course aware of their own vulnerabilities. They currently trying to sell more to other Asian countries that are gradually becoming wealthier, in an effort to counter act possible future loses with United Trading . But the United States is still currently the best trading market in the world.

When Could the Dollar Collapse?

I personally do not see the dollar collapse occurring in 2017. In actual fact it's unlikely that it will ever collapse at all. Simply because any of the countries that have the power to make this happen (China, Japan, and other foreign dollar holders) would like to avoid this happening at all cost. It is just purely not in their best interest. What advantages could you gain by bankrupting your biggest and best customer? I do believe though that the dollar will continue its gradual decline as these countries do increasing business with other markets.
What Would Happen If We Had a Collapse?
A sudden collapse in the U.S. dollar would create immediate and unprecedented global economic turmoil. Investors would panic and rush to trade to other currencies, such as the euro, major assets, or gold commodities. Demand for Treasury’s would immediately plummet, and interest rates would begin to rise. While U.S. import prices would also skyrocket, causing massive inflation.
U.S. exports on the other hand would become dirt cheap, giving the economy a brief boost. But in the long run, inflation, high interest rates and extreme volatility would place a strangle hold possible future business growth. Unemployment would rise dramatically, sending the United States back into major recession or even worse a depression.
How Can You Protect Yourself From A Collapse?
You can start by defending yourself against a gradual dollar decline by keeping your assets well diversified like holding foreign mutual funds, gold, and other commodities.
A U.S dollar collapse would inevitably create a global economic crisis and spread turmoil throughout the world. In order to prepare for this type of uncertainty, you must first be mobile. Keep your assets as liquid as possible, so you can easily shift and change them as need be. Make sure you have diverse and transferable job skills. Always keep your passport valid and up to date just in case things turn bad enough that you can change locations or you need to move quickly to another country. These are just some useful ways you can protect yourself and survive a dollar collapse

This has been an @crypto-expo

(Image's sourced from Google images)