Quote:
Originally Posted by sesame
Did you not read this from the wall st. Journal, Tracy?
Quote:However, the technical and political hurdles to implementing China's recommendation are enormous, so even if backed by other nations, the proposal is unlikely to change the dollar's role in the short term. Central banks around the world hold more U.S. dollars and dollar securities than they do assets denominated in any other individual foreign currency.
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Sesame, I think you might be missing the point of the article relative to Tracy's post.
The REASON that China -- as well as Russia and other now-vocal countries like Brazil among others -- are calling for an all-new "global currency" (as Tracy pointed out) is BECAUSE they are "holding more U.S. dollars and dollar securities than they do assets dominated in any other individual foreign currency" (to re-quote the article). They want to GET RID of all those dollar-based securities they're currently holding in their own banks. They want to DUMP them and no longer be tied to U.S. economics or market fluctuations. The problem is they can't do it now because of the crisis and the fact that so much of the world economy...including their own...is centered ON the dollar. Hence, they want to break FROM the dollar as soon as possible and create an all-new currency that they CAN control on their own terms.
The result being that Tracy's post is completely accurate in terms of the point she was trying to make. Things ARE going to get A LOT rougher in the days and years ahead as these countries do whatever they can to start dumping their dollars and dollar-based securities. And things will get A LOT rougher for America as these same countries likewise refuse to buy up our outstanding debt loads -- which again, is the cornerstone of our own system and it's what Obama desperately needs and is literally PRAYING will happen (ie. countries buying OUR debt) in order to keep our own economy afloat.