Welcome! Log In Create A New Profile Recent Messages

Deep Creek Hot Springs

The Moon is Waxing Crescent (34% of Full)


Advanced

Re: SC66

All posts are those of the individual authors and the owner of this site does not endorse them. Content should be considered opinion and not fact until verified independently.

April 20, 2008 06:04PM
http://www.globalresearch.ca/index.php?context=va&aid=8718

Meltdown of U.S. Dollar Underway as China Dumps the Currency

Comments by China that it intends to move away from its reliance on the dollar triggered a sharp drop in the Dow Jones Industrial Average and heightened worldwide fears about the U.S. currency's stability. Chinese Central Bank Vice Director Xiu Jian said that his country is planning to shift much of its $1.4 trillion national currency reserve from dollars to more stable currencies, such as the euro or Canadian dollar. After these comments, the dollar fell to record lows relative to other currencies -- the lowest ever against the euro, the lowest in a generation against the British pound, and the lowest in 57 years against the Canadian dollar.

"The big issue on any currency is if its rate of depreciation is so fast that it scares away all capital, and the announcement that we heard from China sort of feeds those fears," said Larry Smith, chief investment officer at Third Wave Global Investors.

China is the world's largest investor in U.S. Treasury bonds and securities, holding more U.S. debt than any country but Japan. Because China's currency is linked to the dollar, the country also maintains a massive reserve of the currency.

But this policy had already begun to shift at the time of Xiu's comments. China has divested approximately 5 percent of its $400 billion holdings in the U.S. Treasury and established a $200 billion fund to help diversify its investments in equities and stocks around the world.

"We will favor stronger currencies over weaker ones, and will readjust accordingly," said Cheng Siwei, vice chairman of China's National People's Congress.

It is not just U.S. investors who are concerned. Because the dollar's fluctuations have driven up the euro, exports in Europe have fallen and sparked fears for the stability of that continent's economy. In a recent speech, French president Nicolas Sarkozy added his voice to those calling for the Bush administration to act to stabilize the currency.

"The dollar cannot remain 'someone else's problem,' " Sarkozy said. "If we are not careful, monetary disarray could morph into economic war. We would all be its victims."
SubjectAuthorViewsPosted

SC66

Wizard 579April 20, 2008 04:02PM

Re: SC66

Wizard 347April 20, 2008 05:15PM

Re: SC66

Wizard 363April 20, 2008 05:29PM

Re: SC66

Wizard 421April 20, 2008 06:04PM

Re: SC66

Wizard 342April 20, 2008 08:51PM

Re: SC66

Wizard 361April 21, 2008 08:28PM

Re: SC66

Wizard 393April 21, 2008 09:23PM

Re: SC66

Wizard 390April 21, 2008 09:56PM

Re: SC66

Wizard 418April 22, 2008 02:36PM

Re: SC66

Wizard 369April 22, 2008 02:56PM

Re: SC66

Wizard 390April 22, 2008 03:23PM

Re: SC66

Wizard 352April 22, 2008 09:25PM

Re: SC66

Wizard 362April 22, 2008 09:49PM

Re: SC66

Wizard 415April 22, 2008 10:32PM

Re: SC66

Wizard 424April 23, 2008 12:51PM

Re: SC66

Wizard 450April 23, 2008 06:58PM

Re: SC66

Paul P. 346April 24, 2008 12:38PM

Re: SC66

Wizard 340April 24, 2008 06:37PM

Re: SC66

Wizard 374April 24, 2008 07:26PM

Re: SC66

Wizard 373April 24, 2008 10:34PM

Re: SC66

Wizard 371April 27, 2008 09:12PM

Re: SC66

Wizard 823April 30, 2008 02:55PM



Sorry, only registered users may post in this forum.

Click here to login