Currently the US trades dollars for real goods. One of the major uses of those dollars, since we don't export nearly enough goods to run balanced trade, is to buy US assets. Do you think that maybe our trade partners will stop accepting those dollars if we start nationalizing companies? At that point, doesn't it seem like maybe the USD will crumble?
Nah, never happens. Where will they go? The yuan? The euro? The ruble? Dysfunctional emerging markets? Being a global reserve currency is as, if not more powerful than, a DoD branch. Lot of capital available to burn, pun intended. Investors still invest in Greece and Italy, for example, and they’ve done far worse economically speaking.
Important to keep in mind this exposure is graded on a curve. You don’t have to be the fastest when the bear is chasing you, just faster than your slowest friend.
Reading my earlier comment, it's too black and white. It'd be another straw. Is it the one that breaks the back? I have no idea. But I don't think it's wise to start nationalizing companies.
If trust in foreign currency holdings declines (say, if we decide to unilaterally cancel other countries' holdings in our currency when we want to punish them), then I'd assume that creditor nations would start looking at replacing some or all of their US treasuries holdings with real assets that carry less counterparty risk. If we start nationalizing onshored assets, then the field of suitable assets starts narrowing a whole lot to portable things like commodities.
We should work very hard to maintain a reputation as a trustworthy counterparty if we want to be able to continue running large deficits.
You should make a case for this, rather than asking other people to make a case against it. We flooded the world with dollars after 2008 and still couldn't manage to get our inflation over 2% until a year or two ago.
I'm just trying to get you all to think a bit about effects before suggesting something as radical (for the US) as nationalizing a company. I think it's fairly obvious that going from being a very business/investor friendly country to one that nationalizes a major company for delaying passengers is going to shake confidence in foreign creditors to the US.
