Beijing to pitch new global currency; dump dollar

#1
W

WA_Vol

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#1
This is a big story IMO. Someone at work told me this would happen, but I didn't think it would be this quick.

FT.com / Asia-Pacific - China calls for new reserve currency

China’s central bank on Monday proposed replacing the US dollar as the international reserve currency with a new global system controlled by the International Monetary Fund.

Analysts said the proposal was an indication of Beijing’s fears that actions being taken to save the domestic US economy would have a negative impact on China.

“This is a clear sign that China, as the largest holder of US dollar financial assets, is concerned about the potential inflationary risk of the US Federal Reserve printing money,” said Qu Hongbin, chief China economist for HSBC.

Although Mr Zhou did not mention the US dollar, the essay gave a pointed critique of the current dollar-dominated monetary system.

“The outbreak of the [current] crisis and its spillover to the entire world reflected the inherent vulnerabilities and systemic risks in the existing international monetary system,” Mr Zhou wrote.

China has little choice but to hold the bulk of its $2,000bn of foreign exchange reserves in US dollars, and this is unlikely to change in the near future.
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#2
#2
Russia is calling for the same thing: http://www.themoscowtimes.com/article/600/42/375364.htm

The world is about to change:
The Kremlin published its priorities Monday for an upcoming meeting of the G20, calling for the creation of a supranational reserve currency to be issued by international institutions as part of a reform of the global financial system.

The International Monetary Fund should investigate the possible creation of a new reserve currency, widening the list of reserve currencies or using its already existing Special Drawing Rights, or SDRs, as a "superreserve currency accepted by the whole of the international community," the Kremlin said in a statement issued on its web site.

The Kremlin has persistently criticized the dollar's status as the dominant global reserve currency and has lowered its own dollar holdings in the last few years. Both President Dmitry Medvedev and Prime Minister Vladimir Putin have repeatedly called for the ruble to be used as a regional reserve currency, although the idea has received little support outside of Russia.
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#3
#3
#5
#5
One world government is around the corner folks.......One world currency........then no currency.......and a new world leader to come.
 
#7
#7
BigPapaVol said:
It won't be quick. They want to continue selling their nearly free labor pool to the US, they'll do it in dollars. The day the IMF has any say over our economy will be the downfall of the joint.
Posted via VolNation Mobile
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Ultimately the American taxpayer is the one who is responsible for paying off any losses of the IMF. It has been that way from day one.
 
#13
#13
hmm, interesting china is pushing this since it would mean an end to their artificial devaluing of their own currency for monetary gain.
 
#14
#14
dcgf05 said:
hmm, interesting china is pushing this since it would mean an end to their artificial devaluing of their own currency for monetary gain.
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not if the official exchange rate set at the beginning is favorable to china.
 
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