Are the Dollar's Global Currency Days Numbered? - Chinese Economy - Chinadaily Forum
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Are the Dollar's Global Currency Days Numbered?   [Copy link] 中文

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Post time 2014-8-21 00:54:02 |Display all floors
18 August 2014.









It's not going to happen tomorrow, in a year or even five years. But it's conceivable, even likely, that within ten years, the U.S. dollar will cease to become the reference currency for international transactions. The reason for this is that the U.S. government and American judges have politicized the dollar to an extreme in a world where the country backing it is no longer as dominant as it once was.

The United States is an arrogant power, which, like many other empires (and people), is witnessing its influence decline. Indeed, it is hastening this degeneration by wasting its political and symbolic capital, expending it as if the country still stood at the zenith of its glory.

Because of France, the first steps toward the beginning of the end of the dollar's hegemony could begin at the next G20 summit. Here's why: On June 30, the U.S. Federal Reserve backed a Justice Department and New York district court decision to punish the French bank BNP Paribas, one of Europe's biggest, for routinely violating U.S. sanctions on Iran, Sudan and Cuba. Besides fining the French bank almost $9 billion, the U.S. also suspended approval of its dollar transactions.

French President Francois Hollande is one of several heads of leading economic powers who believes that the United States has gone too far in politicizing the dollar, and he favors putting the topic on the G20 agenda. To punish those who violate U.S. economic sanctions exploits the fact that the dollar is an inevitable part of international transactions. It is one of the few subjects on which France, Germany and Russia publicly agree.

Taking its ball and going home

The United States is actually shooting itself in the foot and isolating its allies. Ironically, President Barack Obama, who pledged to reconcile the White House with the world, has barely managed to make a dent in the isolation his predecessor George W. Bush created.

The United States developed intelligent sanctions as a means of exerting pressure on foreign countries and institutions without resorting to military force. One maneuver it can use - and has with BNP Paribas - is to forbid banks from approving dollar transactions, which is otherwise just a formality in the normal process of international finances.

U.S. judges and government officials who are using this to punish those who defy their sanctions have a right to do so, of course. But it's a short-sighted tactic. To describe the problem simply, if the rich kid doesn't want his buddies to play with his new football, they will eventually look for another one - perhaps less fancy - and leave the rich kid to nurse his top-of-the-line toy alone.

This will take time, and the trend may revert. It is bold and difficult to prophesy this way. The dollar's options are not clear. And the euro, while it may not be in the abyss, is struggling to emerge from the bog of the European debt crisis. The RMB, or yuan, is subject to the excessive influence of the Chinese state. Some have suggested that the emerging economies could conjure up an alternative currency, especially after announcing they would start a development bank. But this wouldn't be possible because their economies and institutions aren't sufficiently stable.

If the world had to decide tomorrow on a new global currency, the most reasonable option would be the pound sterling, given its stability and the almost religious respect British institutions show it. If the United Kingdom were to seize the opportunity, its currency could supplant the dollar in fairly short order.

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Post time 2014-8-22 08:47:35 |Display all floors
Yes, it is conceivable.  The politicians are bickering as usual.  And the economists are giving them bad advice, which is "spend and Spend" and spend more and more.  Borrow.  This is their mantra.  Although the USA is still the richest on the planet, they are not on the best path, especially on the government finances.
We showed how easily the debt can be repaid, including detail calculations.  In reality, the US has far more assets than debt.

The US Dollar will continue to be the reserve currency for its stability and ease of exchange.  This is a major criteria to become a major currency.

To understand how the monetary system works and to understand how money is issued into the economy (no, it is not printed out of thin air and no, gold is not a good currency), check out the book series of 259 Trillion Vs 5 Trillion.  Also go ahead and download the presentation files for your understanding.

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Post time 2014-8-24 08:16:07 |Display all floors
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Post time 2014-11-16 03:37:30 |Display all floors
Iran Gold --- 20 million tons




15 November 2014.





Iran launches Middle East's 'biggest' gold plant, plans to double production





Iran has opened a new gold processing plant, reportedly the biggest in the Middle East, hoping to double its production of precious metals.

Using a unique technology, Tehran says it will now mine up to three tons of gold per year.

Iranian TV reported that the opening ceremony was attended by First Vice President Ishaq Jahangiri.

The new facility is located near one of the country's richest mines, Zareh Shuran. It is located 35 kilometers from the city of Takaab in northwest Iran, in an area where gold, silver, and mercury are extracted.

The gold ore reserves of the Zareh Shuran mine are estimated at 20 million tons.

According to authorities, the plant’s production can reach three tons of gold per year and thus can double the total of Iran’s gold production.

Worth over $31 million, according to IRNA, the plant will use a new technology which was created in Iran.

It is expected that the plant’s gold production capacity will soon reach six tons per year. Silver and mercury productions are expected to hit 2.5 and 1.5 tons, respectively.

This implementation is part of the so-called "economy of resistance," which Iran's Supreme Leader, Ayatollah Ali Khamenei, introduced in February.

The policy includes domestic economy building with maximum utilization of the country’s resources, as well as the promotion of a knowledge-based economy and innovation.

The ultimate goal is to become the No. 1 knowledge-based economy of the region.

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Post time 2014-11-19 12:34:02 |Display all floors
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Post time 2014-11-25 21:45:23 |Display all floors
BRICS a healthy alternative to ‘defunct dollar system’





24 November 2014.





The BRICS Bank marks a major step to de-dollarization, and a new monetary system. It should replace the western-dominated “predatory casino scheme” that has contributed to world wars and “economic terrorism,” says former World Bank economist Peter Koenig.

“A ‘BRICS system’ would offer a healthy alternative to the highly indebted and defunct dollar system, where money is printed at will,” Koenig said in an interview with Asam Ismi of the Canadian Centre for Policy Alternatives.

A 'BRICS system' should be based on a new currency, which Koenig called 'Bricso.'

“…it is high time that the currency of worldwide theft, abuse and exploitation – the US dollar – financial instrument for endless wars and economic terrorism, be replaced with a currency of peaceful endeavors that respects national sovereignty – a currency that works for the people, not for the elite few,” said Koenig adding that currently six US banks control more than 60 percent of all banking assets.

A new monetary system should replace the existing FED-BIS (Bank for International Settlement)-Wall Street “dollar denominated predatory casino scheme that has in the last 100 years alone largely contributed to – and benefitted from – two world wars, impoverished our planet, socially and environmentally,” Koenig said “This system is at the verge of a larger abyss than the depression of the 1930s."

BRICS, which is actively leading a massive effort of de-dollarization, can become a viable alternative to the Western economic system, Koenig believes.

Moreover, he thinks BRICS is already in process of replacing it. Increasing cooperation between Russia and China is a clear example – the two countries started to carry out ruble-yuan swaps in June 2014 in order to free themselves from the traditional trading currency, the US dollar.

Ten years ago, the world’s reserves consisted to about 90 percent of dollar denominated securities. Today that figure has shrunk to 60 percent, the economist said.

Koenig believes Washington is afraid of losing the dollar’s monopoly on the global stage, and is trying to destabilize the situation in the BRICS countries. For example, by slandering the government of Dilma Rousseff in Brazil for corruption and high debt, or depreciating the Russian ruble by fraud and currency manipulations.

“Today, though steadily declining, most trading is still denominated in dollars and has to transit through a US bank and the BIS clearing system,” he said. “Under the FED-BIS-WS banking system currencies and gold are subject to exchange rate and interest manipulations”.

The potential of BRICS is promising indeed, as the members account for almost 30 percent of world GDP and about 45 percent of the global population.

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Post time 2014-11-25 22:57:05 |Display all floors
The real WMD of Saddam Hussein






1.   He was starting to back his paper Dinar with gold.

2.   He was starting to sell Iraqi oil for currencies other than the U.S. dollar.





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