BRICs Launch Assault on Dollar's Global Status

Chosun Ilbo ^ | 06/12/09

[TigerLikesRooster]

Ping!

[Daveinyork]

With B Hussein Obama’s policies undermining the value of the dollar, I really can’t blame these people for wanting to divest themselves of greenback based investments.

[DB]

Obama and his brainiacs at work...

Printing money for short term gain while screwing the long term totally.

Brilliant plan...

[TigerLikesRooster]

Ping!

[Jonny foreigner]

and they want to replace the dollar by which currency? the euro? (because it´s the only currency which “could” replace the dollar as global currency). How would this make any difference for them?

[TigerLikesRooster]

I think we end up with a few regional currencies. New global currency is way down the road. I mean, before that to emerge, a few (major) countries will disappear and new ones emerge.

[ex-Texan]

Full Blown Economic War Begins !

[Jonny foreigner]

i think you are correct. i can not see a single currency that will achieve new global status. so the chicoms might dream about the Yuan as the new global currency but this will never happen. US and EU will never accept that. but i do think the time of the dollar hegemony is soon to be over too.

[dennisw]

Inneresting....

Alledgedly these BRIC nations are not saddled with tons of debt and are willing to strike out on their own. They are nations that concentrate on commodities, buying and selling them. They have much smaller paper (meaning phony) economies. Much less parasitic financiers living off the fat of the land

They probably view the USA as financiers and money manipulators trying to rip off their hard word

[dennisw]

fewer parasitic financiers living off the fat of the land

[TigerLikesRooster]

As you can see, those who fare best in the current crisis are those with only rudimentary financial sector. Sometimes being dumb on certain things could save your skin.:-)

[JasonC]

No, they are not. A million pundits looking for a doom story keep pretending they are selling their bond holdings, but as Barron's noted in today's edition, the reality is foreign central bank holdings of US treasuries are up $19 billion.

They are just trying to jawbone their own currencies higher, while still buying treasuries to the full extent their export surpluses will bear. But this isn't sexy enough to sell a newspaper, so nobody reports it (Barron's excepted).

[dennisw]

As you can see, those who fare best in the current crisis are those with only rudimentary financial sector.

You nailed it
I'll bet that most banks in India and China will give you a passbook savings account and that is it
Plus the stock and bond markets in BRIC countries are a smaller part of the economy
The number of people employed in --->>>

Finance
Insurance
Real
Estate

is much smaller

[GOPJ]

Thanks for the ping.

[GOPJ]

The BRICs are also soliciting public support for a "super currency" capable of replacing what they see as the ailing U.S. dollar. The four countries account for 22 percent of the global economy, and their defection could deal a severe blow to the greenback.

We would not recover if they pull this one off...

[Jonny foreigner]

We would not recover if they pull this one off...

---

well i guess as long as most of the world trades oil in dollars your currency is relative safe. the doomsday scenario for the dollar i guess would be opec switching to euro for example.

[GOPJ]

The problem happens when we can't inflate our way out of the debt caused by liberal social programs. We stick the rest of the world with our social welfare bill.

Think of it this way -- ever wonder why creepy little poverty stricken countries like Haiti can't just "print more money"?

They can't do it because they aren't a reserve currency. We are. And the Chinese are scared to death they're going to be paying for GM, bad housing loans, unreformed Social Security etc.

Really - think about it - take away the reserve currency status and we're like Haiti - overnight poor.

[Jonny foreigner]

as i said i think the dollar is doomed the day most of the world has not to buy dollars any more to pay their oil. this is the biggest threat to your country (bigger then iran, north korea...) because you would lose all the “benefits” beeing a reserve currency. but on the other side i can not see for example the EU would be willing to take over this role of a reserve currency if possible (because it would definitely benefit “us” the short way but in the long way it would be the same. the Euro would be held hostage instead of the dollar from the rest of the world). and more important neither EU nor China has a serious personal interesst in a poor US. a little bit weaker? definitely yes. but doomed. Hell no. so i don´t think this will happen anyway
greetings

[DoughtyOne]

We took our national ‘nuts’ and placed them in China’s hands. Now China is banding with other nations to squeeze.

Well, I told folks so... here we are.

Being a debtor nation comes with risks. If foreign concerns stop buying our treasuries, good luck...