U.S. government shutdown / debt ceiling convulsions prompt renewed calls to dump the $
Once again, the Chinese are seizing on the chronic dysfunction in Washington - coupled with the debt ceiling standoff - to suggest the U.S. Dollar be displaced from its central role in the global financial system. (Of course, Beijing is the chief holder of U.S. debt.)
Fortunately, the Chinese Yuan, or a basket of currencies, don't represesent a viable replacement -- yet.
But, even if the President & Congress "kick the can down the road" -- as now seems likely -- the Chinese and others get new fodder for their longterm efforts to dethrone the greenback.
This fits with Allan's topic as this morning on APR's [American Public Media] Market Place Morning Report broadcast, they did a story about how London is now the Chinese currency hub for the world. So the Chinese are becoming more and more the new power, even in the financial world. Below is transcript of that broadcast.
True. Who ever is the world's biggest buyer, will be the one to set all prices... speaking figuratively of course...
It may take some time for official diplomatic policy to catch up to financial reality, but just as the dollar eventually took over from the pound, as China grows and Republican policies shrink our economy even further, it is only a matter of time...
Thu, Oct 17, 2013 3:02am
Furthermore, one has only to see the infrastructure investment China has made, while we flipped off a couple of trillion to play army the Middle East and Central Asia, to understand that this is eventually coming.
As did Britain eventually have to kow-tow to us, we are going to have to give up our power to call the shots... over to China.
Anyone who says government can't create jobs is ignorant about China. The reality is that we choose to hide behind the luxury of admonishing big government, while China proves what is possible anytime a government can take off without restraints.
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