Since the breaking of the gold link, the dollar has become the world's primary measure of value. But the dollar, like the gold standard before it, is under pressure. For the United States, a falling dollar means pricier imports but also an export boom that could carry the economy through its housing bust. Yet, for countries that use the euro, a weak dollar means a loss of competitiveness. And for dollar-pegging Asian exporters, a falling dollar worsens the export boom that is overheating their economies. So the world faces a dilemma. Sebastian Mallaby argues that a long-term goal of an alternative global currency may be in order.
