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Investor concerns about continued large budget deficits and runaway inflation have led many to question the dollar’s status as the world’s principal reserve currency. Indeed, some important developing countries have recently put forth proposals for a new international currency that is meant to compete with the greenback as a reserve currency. Is the dollar doomed as a reserve currency in the short run? What about the long run? What, if anything, can the administration and the Federal Reserve do to maintain the reserve currency status of the greenback?