Dollar on the road of extinction as reserve currency

[cindy25]

Still the best-worst currency in the world. I'm still accepting dollars.

of course you should accept USA dollars, but also Hong Kong dollars, British pounds, Swiss francs

reserve currency means currency held by other central banks, in lieu of gold.

the USA dollar being diminished is a good thing, as it will increase the use of gold, and diminish the USA governments ability to bully other countries (the Swiss on bank secrecy, the Ukrainians on copyright nonsense-the list is endless)

[bxm042]

the USA dollar being diminished is a good thing, as it will increase the use of gold, and diminish the USA governments ability to bully other countries (the Swiss on bank secrecy, the Ukrainians on copyright nonsense-the list is endless)

true, but then again as long as there is central banking there will always be this kind of bullying... it's the USA now... tomorrow, China?

death to central banking...

[heavenlyboy34]

As you probably know, China and Russia are doing everything to collapse dollar as world's reserve currency.

Today, China have a agreements with more than 35 countries that includes direct trade without dollar with Germany, Russia, Japan, Australia, N. & S. Korea, Turkey, Brazil, South Africa, India, Iran, and so on; all countries from BRICS block are doing trade without dollar with each other and for the first time and most important of all - Russia is selling oil in their own currency - ruble and chinese reninmbi and all former Soviet Union block are doing trade in ruble.

I'm from Serbia, so you probably don't know what's happening outside of US, but in Europe in general, everyone is trying not to use dollar anymore in their trades. From few days ago, even Serbia and Russia have started doing trade without dollar as reserve currency.

Therefore, I would like to know your opinion about future of the dollar and his geopolitical influence? Will US be able to succeed to save their currency in present form, precisely, will be able to regain its former glory or the dollar will continue to fall down?


Best wishes,
Ivana.

Првивет!
Being a Russophile and student of Russian language/culture, I follow Russian news and have read/heard a bit about this. I am of the opinion that, barring something strange happening, the downward spiral of dollar hegemony will go on for some years (perhaps decades depending on what tricks TPTB can pull out their asses) and eventually the dollar will no longer be the world reserve currency. The Euro seems to be the next Big Reserve Currency at this time. (the EuroZone is a financial mess, but they aren't engaged in perpetual war and their spending isn't quite as insane...but it's close) Could be Chinese Renminbi too...I know even less about that than i do about the Euro. :/

[bxm042]

Could be Chinese Renminbi too...I know even less about that than i do about the Euro. :/

I don't think Americans would accept the RMB as the world's reserve currency without a war. The Euro may be a bit more palatable, but I'm fairly sure our country's pride couldn't handle the RMB

[heavenlyboy34]

I don't think Americans would accept the RMB as the world's reserve currency without a war. The Euro may be a bit more palatable, but I'm fairly sure our country's pride couldn't handle the RMB

Could well be. That would be rather good though, as it could motivate people. But I try not to have too much faith in almost all my countrymen. They've disappointed me far too many times.

[devil21]

I don't think Americans would accept the RMB as the world's reserve currency without a war. The Euro may be a bit more palatable, but I'm fairly sure our country's pride couldn't handle the RMB

Americans wouldn't have to use the rmb for daily trade so Im not so sure it's as big a concern as you make it. The value of the dollar will crash and cause uproar for that reason but it wouldn't mean that Americans would suddenly have to use chinese money with pics of Mao on it or whatever. The dollar is the global reserve currency but you don't see it being the official money of practically anywhere except here. This mainly affects giant corporations, gov't debt auctions, and central banks.

[kety]

It's happening faster than ever

Bank of England Closes In On China Currency Deal

Sir Mervyn King, Governor of the Bank of England, is on the brink of striking
a deal with the People's Bank of China which would cement the UK's role as
the leading G7 trade hub for the world's fastest growing currency.

The Bank of England expects to sign a final agreement to set up a three-year
yuan-sterling swap line "shortly", during a meeting between Sir
Mervyn and his counterpart Zhou Xiaochuan in Beijing.

Beijing is slowly delivering, although it still keeps a tight rein on gains
for the currency for fear it will weaken its export-powerhouse economy,
which has been the biggest engine of global growth for a decade.

This would be the latest in a string of bilateral currency agreements that has
seen cross-border trading of the yuan expand four-fold since August 2010,
and the first with a major developed economy.

Britain's central bank has been eyeing such a deal for some time, saying last
month it was ready "in principle" to adopt a currency swap line
with its Chinese counterpart as the yuan starts to emerge as a world reserve
currency.

http://www.telegraph.co.uk/finance/c...ency-deal.html

Ok, I think it's now like 80% or even more of the world that has dropped the dollar in trade with China and their neighborhoors.

[torchbearer]

Anybody who's dissatisfied with dollars, please, give them to me!

I would give them to you, but the cost of living is increasing so fast, there are none to give.
there is a big sucking sound going from the poor and middle class to their masters in DC.

[kety]

Russia wants to strengthen influence of BRICS

March 12, 2013 Konstantin Garibov, The Voice of Russia
The initiative calling for a more influential BRICS has been formulated in a report prepared by Russian experts for the next summit in Durban on March 26.

Russia suggests strengthening the influence of BRICS that embraces Brazil, Russia, India, China and South Africa. The initiative has been formulated in a report prepared by Russian experts for the two-day summit of the grouping that will start in Durban on March 26.

Experts insist on the need to setting up a permanent secretariat, originally virtual and then a full-pledged one. Last year, India suggested creating a new development bank. The authors of the report proposed to set up the headquarters of the bank with an authorised capital of $50 billion in Moscow. Last spring, the partners of the BRICS summit in New Delhi decided to trade in local currencies and replace the United States dollar as the main unit of trade between them. In view of this, Russian experts propose to create a bank for international settlements to assure safety to the economies of BRICS member countries from sharp fluctuations of the exchange rate of the dollar and the so-called “currency-wars.” Russian experts have also proposed to set up an anti-crisis fund of $240 billion amidst the second wave of the global financial crisis.

The Russian initiatives are aimed at strengthening integration, says Andrei Volodin, expert at the Diplomatic Academy of the Russian Foreign Ministry. The reason here is that at present, economic integration between BRICS member countries is clearly insufficient.

Russian experts in economic integration suggest supplementing it by the joint work in security area. Among these are fighting against the spread of weapons of mass destruction, cybercrimes, drug trafficking and piracy. It has been proposed to admit an Islamic country, Indonesia or Turkey, to upgrade the organization’s humanitarian and inter-civilisational potential.

The report also pays attention to the contradictions within the BRICS. Its authors describe territorial disputes between China and India, competition for raw material resources and differences in the approaches towards climate change as time bombs. Russia can use its prestige to convince its partners to ease strain amongst themselves. Co-chairman of the Council for National Strategy Iosif Diskin agrees with the experts.

“Russia’s partners have displayed keen interest in its active economic and foreign policy position and Russia has a unique possibility of multiplying its economic and political influence,” says Diskin. However, no one should forget that the West sees its rival in BRICS. Consequently, it will try not to give an opportunity to strengthen the five countries on the international scene. The report prepared by Russian experts for the government is aimed at hampering such a development. It will be the basis of the drafting of Russia’s national strategy in the framework of BRICS.

http://indrus.in/economics/2013/03/1...ics_22833.html

[Athan]

You mean their trade agreements will be finalized as todays agreements cease to exist or they'll sign a new agreements within the block?

Ivana.

I believe it is other agreements that will be executed within the block and those who will be trading with the block. It could also be some of the current ones are not finalized. I would need more data on hand. The information we get mostly comes from press releases.