The Dollar Credit Crisis under Triple Shocks

Abstract

This paper employs the money market and goods market model (IS-LM) and the aggregate demand-aggregate supply model (AD-AS model) to analyze the impact of the Federal Reserve's four rounds of dollar quantitative easing (QE) on inflation from the perspective of monetary credit. From the aggregate supply and dollar settlement system angle, the decline in the share of the dollar and the SWIFT settlement system is examined for its effects on inflation. Additionally, it explores the profound implications of the 2025 tariff war on U.S. sovereign bonds within the U.S. sovereign bond recycling system. Consequently, the three major pillars of dollar credit are under severe strain, and the dollar capital market faces collapse.