China wants a new non "credit based" reserve currency

Discussion in 'Wall St. News' started by W4rl0ck, Mar 24, 2009.

  1. W4rl0ck


    China doesn't like the US Federal Reserve because the Fed has been debasing the currency since it was founded? Say it's not so!


    China calls for new reserve currency

    Last update: 7:55 p.m. EDT March 23, 2009
    BEIJING, Mar 23, 2009 (UPI via COMTEX) -- China Monday called for the U.S. dollar to be replaced as the international reserve currency.
    Instead, the Chinese government said it wants a global reserve system controlled by the International Monetary Fund, The Financial Times reported.
    The goal is to create a global reserve currency that is divorced from individual nations and is able to "remain stable in the long run, thus removing the inherent deficiencies caused by using credit-based national currencies," Zhou Xiaochuan, governor of the People's Bank of China, was quoted by the newspaper as saying.
    Zhou's remarks were posted in a paper posed in English and Chinese on the country's central bank's Web site.
    The Times noted that in his essay, Zhou did not specifically mention the U.S. dollar, but the paper took issue with the current dollar-dominated monetary system.
    "The outbreak of the (current) crisis and its spillover to the entire world reflected the inherent vulnerabilities and systemic risks in the existing international monetary system," Zhou wrote.
    An analyst said Zhou's remarks are a strong indication that Beijing worries that measures taken to boost the American economy could affect China negatively.
    "This is a clear sign that China, as the largest holder of U.S. dollar financial assets, is concerned about the potential inflationary risk of the U.S. Federal Reserve printing money," said Qu Hongbin, chief China economist for HSBC.
  2. China holds a shitty 630 billion in dollars. The federal reserve announces a new term facility of that size weekly!

  3. What's ironic about this call is that the IMF was created by the US, and is pretty much run by the US.

    So, if you look a little deeper, it seems the US powers that be no longer want the burden of being a reserve currency on the dollar.

    They want to be able to freely inflate without affecting the world inflation rate. With the Bancor, or whatever the IMF will create, the US can inflate the dollar and devalue, to help change the US economy from consumer driven to a mixed manufacturing and services economy.

    This falls into place with what china has been doing; ie they are trying to stimulate the domestic chinese consumer, so they are not just an export economy.

    The fed has been trying to figure a way out of the current model of the trade deficit for years. So, it seems they are now trying to solve this so the next growth path is not based on another bubble.

    It may work, or it may collapse the world economy. The world economy is driven by the US consumer, and if they inflate us out of our standard of living, this current problem will be nothing compared to the coming shitstorm. I think they are doing an experiment that they are unsure of the outcome. It could be great, or an all out turd. But since we're in the midst of a massive meltdown, they have the leeway to take this rather large risk.
  4. bidask


    pardon me if this is a stupid question. but what does it mean when the U.S. government owns 45% of the U.S. national debt?

    isn't this the debt of the u.s. government? then how can it borrow from itself?

  5. RUT ROH! That 45% is the money owed to the Social Security fund, so if you think you are going to actually get anything of value to retire on, you'd better think again.

    I don't see how we'd get to keep borrowing from the world ad-infinitum if they stopped using out pretty green paper to trade with.

    Just imagine if we couldn't buy imported goods because our dollars weren't worth enough to buy them....
  6. ZOG = mahmud ahmadinejad?
  7. bidask


    if you own the debt it means you lent the money.

    the chart says the U.S. government owne 45% of the debt, so it lent 45% of the money.

    how does the u.s. government lend itself money?
  8. Yea, thats right. All Jewish people have a pact to control all money and destroy all other people. Get real. Next thing your going to say is the Bilderberg group controls world domination. Get some sleep. Your still an anti-semi, and to hate any person just because of a religion they were born into is really pathetic and immature. Grow up.
    #10     Mar 24, 2009