http://moneynews.com/StreetTalk/US-US-IMF-Reserve/2010/02/26/id/351082 Friday, 26 Feb 2010 04:19 PM Dominique Strauss-Kahn, the head of the International Monetary Fund, suggested Friday the organization might one day be called on to provide countries with a global reserve currency that would serve as an alternative to the U.S. dollar. "That day has not yet come, but I think it is intellectually healthy to explore these kinds of ideas now," he said in a speech on the future mandate of the 186-nation Washington-based lending organization. Strauss-Kahn said such an asset could be similar to but distinctly different from the IMF's special drawing rights, or SDRs, the accounting unit that countries use to hold funds within the IMF. It is based on a basket of major currencies. He said having other alternatives to the dollar "would limit the extent to which the international monetary system as a whole depends on the policies and conditions of a single, albeit dominant, country." Strauss-Kahn, a former finance minister of France, said that during the recent global financial crisis, the dollar "played its role as a safe haven" asset, and the current international monetary system demonstrated resilience. "The challenge ahead is to find ways to limit the tension arising from the high demand for precautionary reserves on the one hand and the narrow supply of reserves on the other," he said. Several countries, including China and Russia, have called for an alternative to the dollar as a reserve currency and have suggested using the IMF's internal accounting unit. Strauss-Kahn said the IMF also needs to do a better job of tracing how risk percolates through the global economy. "Here it will be essential to improve our ability to monitor several dozen large complex financial institutions that make up the `plumbing' through which global capital flows," he said, while leaving national regulators the job of monitoring the solvency of individual institutions.
Dominique Strauss-Kahn, often referred to as DSK, (born 25 April 1949 in Neuilly-sur-Seine, Hauts-de-Seine) is a French economist, lawyer, and politician, member of the Socialist Party (PS). He was selected as the new Managing Director of the International Monetary Fund (IMF) on 28 September 2007. A former Finance and Economy Minister in Lionel Jospin's "Plural Left" government, he belongs to the center-left wing of the PS. He sought the nomination in the primaries to the Socialist presidential candidacy for the 2007 election but was defeated by Ségolène Royal in November 2006. He's a socialist with a girl's name. This type of talk is expected from socialists. Germany got their asses handed to them by Greece as they were admitted to the EURO. Now they take a hit in standard of living as a result. This is the type of stuff that causes wars. Ain't gonna happen and if it does anytime soon you better buckle up cause there's a hard times a comin' Ma.
Why does China and Russia want a world currency? Is it just because they are holders of Treasuries? So is Japan and Saudi Arabia... Overall, it sickens me.
You know, I've just realized something. For all the hype, scaremongering and stupidity involved around this sort of thing people have failed to notice on thing about America. They're bankrupt. This is merely the last whiney and pathetic breath of an empire trying to exercise its influence. They won't be able to even afford making a new currency at this rate especially when the elections come around.
Yes that may be true that the US has debt but let's be logical here. The US rolled 8.2 TRILLION out to support the GLOBAL financial structure as the world's reserve currency and largest economy it was imperative lest a full scale meltdown allow the world to spiral into a horrific deflationary death spiral. Of that 8.2 trillion guess how much went to the merry old BOE. 1 TRILLION. Stop fooling yourself. This is a global problem. Worse in Europe than the US. Having said that it does create conflict as nations like Germany bail out their less fiscally prudent EURO conscripts such as the PIGS. It creates tension when other nations (France comes to mind given the headline of this thread and hence the background info on DSK in the above post) and the organization he leads the IMF. In 2008, faced with a shortfall in revenue, the International Monetary Fund's executive board agreed to sell part of the IMF's gold reserves. On April 27, 2008, IMF Managing Director Dominique Strauss-Kahn welcomed the board's decision of April 7, 2008 to propose a new framework for the fund, designed to close a projected $400 million budget deficit over the next few years. The budget proposal includes sharp spending cuts of $100 million until 2011 that will include up to 380 staff dismissals. At the 2009 G-20 London summit, it was decided that the IMF would require additional financial resources to meet prospective needs of its member countries during the ongoing global financial crisis. As part of that decision, the G-20 leaders pledged to increase the IMF's supplemental cash tenfold to $500 billion, and to allocate to member countries another $250 billion via Special Drawing Rights Where do you think the IMF got their ten-fold increase? Stop the coy US bashing. We all know the UK and EUROZONE are in a world of hurt. For right or wrong the US has the wildcard in the deck which allows them the ability to print against reserve given the size of our economy and status worldwide in the financial markets. https://www.cia.gov/library/publications/the-world-factbook/rankorder/2001rank.html Yes the EUROZONE and the US are ranked equally by GDP hence the call by DSK for a "new world currency." How would that help the EURO, the Pound, and all the other struggling non-EUROZONE participant nations? Yes their is strife as the financial crisis unfolds and it could get ugly for all the reasons discussed as the haves and the have nots grapple with the 21st financial and economic changes unfolding before our eyes. But for the time being and going forward the USD is the go to currency in the world economic zone and until that changes the EURO and Pound are gonna tank as private entities even soveriegnties flee to the USD in times of wealth preservation. As far as US Debt is concerned do not worry the proletariat in the US will take in the shorts as always and their social security benefits will get hacked by raising the age of participation to the age of 67 then 70 essentially making the debt whole. I would say keep on track with regard to how to stay solvent and perhaps even prosper from the drastic changes happening in the markets now.
This theory of constantly comparing US to countries that are deeply in financial trouble, in order to make us look good by comparison, is just about played out. Instead of comparing the US to Zimbabwe, Greece, or other countries near financial ruin, try contrasting our situation with Brazil, India, China, or Norway for a change.
I'm just going to stop your rant and say I hate Europe and the U.K as well. They're not much better than the U.S but even so they haven't been so trainwrecked with their spending and overseas military campaigns. At least if Europe and the U.K go bankrupt we probably won't have China trying to rape us while we're dead. Also, look up the German depression after World War 1, the puppet government that was installed there tried to print their way out of the recession they were in and it ended up giving rise to the Nazi party because their currency was so worthless that people were taking wheelbarrow fulls of paper home. Go research some REAL history instead of just believing what the government says and believing blatant propaganda. Hell school texbooks won't even talk about the idea and possibility that it could be because of printing money and inflating the currency with debt that we get into these messes in the first place. The entire system is completely flawed and it was designed so that goldsmiths could scam people out of their money.