There are two main factors that could trigger a U.S. dollar collapse. China could achieve reserve currency status for the yuan, undermining the relevance of the U.S. dollar and U.S. stock markets could crash.

The Federal Reserve spent more than $4.0 trillion preventing both a stock market crash and the U.S. dollar collapse. Unfortunately, quantitative easing wasn’t meant to last forever.
The Fed finally wound down their bond buying program last year, injecting a strain of worry into stock markets. We’ve seen that strain grow into a full-fledged panic this year, with markets gyrating wildly through the summer.
Why are they panicking? Well, the short answer is that monetary stimulus is nearly at an end.

But what does that mean for U.S. stock markets? Does it necessarily signal a U.S. dollar collapse in 2016? The answers are far from clear, but there are legitimate fears of an economic collapse. At the very least, a stock market crash is virtually guaranteed.
Consider this; at the same time the Federal Reserve is wrapping up its monetary stimulus, we’re seeing a massive reordering of global power. China has evolved from being a regional power to a heavyweight on the international stage.

Russia successfully annexed Crimea and Eastern Ukraine without any practical opposition from the West, and Iran has been admitted back into the community of nations. The world has changed a lot in a surprisingly short while.
We’re no longer living in a unipolar world where America could singlehandedly dictate terms to everybody else. These days China, Russia, Germany, Iran, and Saudi Arabia are powerful geopolitical forces in their own right.

As political power redistributes to these countries, so too will capital flows. The U.S. dollar will be brought down from its pedestal and be measured alongside the yuan and the ruble. That much is clear.


One potential factor in a U.S. dollar collapse in 2016 is the rise of the yuan. China’s currency is growing ever more important in world affairs, and it’s not by accident.
Time and again, the country’s leaders have announced their intention to gain reserve status for the yuan. Reserve currencies are essentially the backbone of international finance.

Central banks across the world hold large quantities of these currencies as a way of gaining credibility for their own country’s currency. Granting China reserve currency status would symbolize its transcendence in the world order.

There are currently seven reserve currencies in the world, but none come close to the U.S. dollar. As a percentage of total holdings, the U.S. dollar accounts for more than 63% of currency reserves, followed distantly by the euro at 21%.
This wasn’t always the case. Before WWI, currency reserves were made up of Brit . . .


http://www.profitconfidential.com/u-s-dollar/will-u-s-dollar-collapse-in-2016/

Hmmmm