Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
July 6 (Bloomberg) -- Russia and India said the world economy is too reliant on the U.S. dollar and called for changes in how $6.5 trillion in currency reserves are managed, as Group of Eight leaders prepare to meet this week.
“The dollar system or the system based on the dollar and euro have shown that they are flawed,” Russian President Dmitry Medvedev said in an interview with Corriere della Sera, repeating his proposal for a new international reserve currency.
Suresh Tendulkar, an economic adviser to Indian Prime Minister Manmohan Singh, said in a July 3 interview that he is urging his nation to diversify its foreign holdings away from the dollar.
The challenge to the dollar, a linchpin of world finance and trade since 1945, underlines the shift in relative economic power toward emerging markets and away from the developed nations that spawned the global crisis.
But in remarks that appeared intended to reassure Washington, Chinese Vice Foreign Minister He Yafei told reporters in Rome: "The U.S. dollar is still the most important and major reserve currency of the day, and we believe that that situation will continue for many years to come.
And the last thing that China wants or needs right now is for the dollar to tank.
Why?
Because China is awash with dollars. They need a little time to unload them before they make the switch to another currency.
The Red's have got this all figured out.
Mark my words ... Once China has diversified it's currencies enough, and sells off most of it's dollars, they will drop the dollar like a hot rock.
I think the U.S. should move to find some other way to prop up the dollar, or at least prop it up with more than just oil, before China jumps ship.
If the U.S. owes China a few million, it's America's problem; if the U.S. owes billions, it's China's problem!
Answer, probably some Chinese version of Keynes or Donald Trump, like Pan Shiyi.
A wise Chinese man once said, Speak softly to media, but carry big stick to annual meeting!
And here's China, the loudest of the bunch saying the dollar will be top dog for many years.
China reassures on dollar debate before G8 - Yahoo! News (http://news.yahoo.com/s/nm/20090705/bs_nm/us_economy_currencies_1 - broken link)
About a week ago, China was advocating dropping the dollar for something new like a IMF currency... It seems publicly they say the dollar is okay but behind close doors, they are looking for an exit... Cause if everyone abandoned the dollar, China would lose money... China is playing its cards, you just have to read between the lines... Everyone is looking to escape dollar but publicly they are going to distort things a bit so they aren't left holding the bag...
Russia and India are both on economic foundations of sand.
Russia will never properly manage it's economy. Their relying on oil and gas, which is slipping away from their control.
India is geographically located in a "powder keg". Pakistan, and the surrounding countries are fighting for their survival against radical Muslims - guess who's next.
Also, keep in mind that the real economy in this world is still based on "merchant trade". And here in the U.S.A. there are thousands of companies of all sizes that have much control over this business. You don't hear about them - Many are privately and closely held by families for generations.
They are not being secretive - They simply run their businesses the old fashion ways. Through hard work and avoiding controversy. For instance, many will not take on a government contracts - any government. That is why they survive for generations - you can never be sure how long a government will be in power, so you don't make enemies. Business is business, politics is politics - two different worlds. You choose one or the other.
And though they have offices set up all over the world - the real ownership is right here.
And the last thing that China wants or needs right now is for the dollar to tank.
Why?
Because China is awash with dollars. They need a little time to unload them before they make the switch to another currency.
The Red's have got this all figured out.
Mark my words ... Once China has diversified it's currencies enough, and sells off most of it's dollars, they will drop the dollar like a hot rock.
I think the U.S. should move to find some other way to prop up the dollar, or at least prop it up with more than just oil, before China jumps ship.
"China’s ability to continue its acquisition of foreign assets may be sustainable and it comes at a time when the global economy is weak enough and credit availability is sparse enough that government-backed businesses in China will be the buyers or financiers of last resort of assets which many nations consider strategic to their security and ongoing industrial and technology independence."
BEIJING (Reuters) - The financial crisis has laid bare defects in the dollar-led global economy and the world should look to displace the U.S. currency, even if that will take many years, Chinese officials said in comments published on Monday.
***
"The financial crisis caused the global economy to suffer heavy losses and it also let us clearly see how unreasonable the current international monetary system is," Li, a former central bank vice governor, said.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Keep reality in perspective
