Author Topic: "China's yuan 'set to usurp US dollar' as world's reserve currency"  (Read 1727 times)

Offline Heavy G

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kolarshooter

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I posted most of this in another thread, but it fits in here just as well...

http://www.treas.gov/tic/mfh.txt <-- Here is data from the US Treasury website.  This data is a list of holders of US Treasury Securities.  The Chinese own 768 Billion potentially worthless US greenbacks, with Japan close behind with 687Bn  This data does not account for China's 1+ Trillion in U$D cash reserves, nor does it account for unknown billions in US denominated private securities (IE: Potentially worthless: derivatives; securitized mortgage debt; equities; bonds, etc.)

If any of the top eight countries on the Treasury's list dumped their Treasury Instruments, there would be a mass stampede for the door - our treasury instruments would immediately become worthless...our currency would collapse as we experience a systemic failure of our unsustainable economy.  It is just another fiat currency, and don't kid yourself - these countries understand the significance of August 15 1971.

I'm not advocating this, nor am I predicting this real soon, but it is a distinct possibility and could happen with alarming speed, at any time, for any of myriad reasons.

Offline chris

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This is a good thing. Being the worlds currency means you can export most of your inflation. Not being the worlds reserve currency might encourage some fiscal responsibility here at home.

kolarshooter

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This is a good thing. Being the worlds currency means you can export most of your inflation. Not being the worlds reserve currency might encourage some fiscal responsibility here at home.
You are correct, absolutely. 

However I'm afraid that the U$D will cease to be the reserve currency when the U$D ceases to exist.   :-[

Offline chris

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Re: "China's yuan 'set to usurp US dollar' as world's reserve currency"
« Reply #4 on: July 16, 2010, 01:37:19 AM »
For me, China is reasonable by saying that US Dollar would be the world's reserve currency. Know why I say China is right? Well, because US dollar is the most powerful and most popular currency even in the world war.

The Chinese aren't stupid, they understand how the Ponzi scheme works. They want, and may well get, the worlds reserve currency. More likely though, an international one will be created. Either way, someone else will get to run the Ponzi scheme for awhile.