It's El's senior year at the dark and dangerous magical boarding school first introduced in A Deadly Education - and the school seems more determined than ever to destroy her. The history of that transfer of power, described in my book, “When Washington Shut Down Wall Street: The Great Financial Crisis of 1914 and the Origins of America's Monetary Supremacy,” shows that only a credible alternative can topple the world’s entrenched medium of exchange.The second book in Novik's Scholomance series packs an amazing wallop. dollar replaced the British pound as the king of international finance. America’s recent sequestering funds of its enemies might worry some about the rule of law in the U.S., but Brazilian President Lula need only ask his constituents in Sao Paulo whether they prefer to hold their nest eggs in New York or Beijing to understand why the dollar dominates world trade. China’s largesse can “persuade” countries to hold its currency, but investor perception that Beijing makes the rules as they go along, compared with America’s record of free capital markets, the rule of law, and price stability, strengthens the dollar’s role as the unparalleled safe haven currency. After borrowing from China’s central bank, these indebted countries then keep the renminbi in their foreign exchange reserves. Moreover, China has been making emergency loans to countries such as Turkey, Argentina and Sri Lanka. China’s growth as an export powerhouse enhances the renminbi in world trade. De Gaulle’s protest did little to damage the dollar’s long run dominance, but Chinese leader Xi is much more of a threat than the former French President. Sixty years ago, French president Charles de Gaulle worried that the reserve currency status of the dollar alongside gold gave America an “exorbitant privilege.” He fought back by returning French gold bars to Paris from storage facilities at the Federal Reserve Bank of New York. dollar in world trade: “Every night I ask myself why every country needs to trade in the dollar.” He then added some history: “Who decided it was the dollar after the disappearance of the gold standard?” Lula is not the first foreign leader to complain about the dominance of the dollar. da Silva’s speech a few days earlier in Shanghai, where the Brazilian president took aim at the U.S. Two weeks ago, Chinese leader Xi Jinping greeted Brazilian President Lula da Silva outside the Great Hall of the People in Beijing, where they reviewed a Chinese military honor guard. The Chinese Renminbi Cannot Replace the U.S.

The last graduate series