The Federal Reserve has set up various schemes to relieve the pressures of US dollar-denominated debt outside the United States. The problem is they don't work well in most cases. Like the US, commercial banks in other countries are usually required as a transfer mechanism.
If the banks aren't willing to lend to a failing business as an example the newly printed dollars just sit at the Federal Reserve.
So if the US dollar appreciates it'll cause several countries, and maybe countries to go bust. If this happens on a global level it could be the final push or motivation required for everyone to abandon the US dollar fiat currency system.
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P. S. Wanted to point out in the chart of dollar index in the 1970s, it actually went UP at certain times when inflation was extremely high (see chart). Also, if the dollar was collapsing the Fed could pull a Paul Volcker but it would completely destroy the US economy, that's why I didn't mention it, but to be clear, it would be an option. Thanks for watching everyone!
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