Guests, feel free to register & join the discussion! I recently read (either on this forum or something linked to this forum) about what will happen to the value of the dollar if it ceases to be the world standard currency. I don't have a mind for the details of such things, but it wasn't a rosy scenario. Perhaps someone remembers what I'm referring to, or can explain what this will do to the value of the dollar.
A government with America's best interest in mind would be fighting for the dollar, not considering abandoning it.
US Administration’s Backing of Global Currency Shocks Global MarketsSecretary of the Treasury Timothy Geithner’s comments that the US would support a global currency shocked global markets.
The dollar plunged instantly against the euro, yen, and sterling as Geithner’s comments flashed across trading screens. David Bloom, currency chief at HSBC, said the apparent policy shift amounts to an earthquake in geo-finance.
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[blockquote]US Treasury Secretary Tim Geithner shocked global markets by revealing that Washington is “quite open” to Chinese proposals for the gradual development of a global reserve currency run by the International Monetary Fund.
The dollar plunged instantly against the euro, yen, and sterling as the comments flashed across trading screens. David Bloom, currency chief at HSBC, said the apparent policy shift amounts to an earthquake in geo-finance.
“The mere fact that the US Treasury Secretary is even entertaining thoughts that the dollar may cease being the anchor of the global monetary system has caused consternation,” he said.
Mr Geithner later qualified his remarks, insisting that the dollar would remain the “world’s dominant reserve currency … for a long period of time” but the seeds of doubt have been sown.
The markets appear baffled by the confused statements emanating from Washington. President Barack Obama told a new conference hours earlier that there was no threat to the reserve status of the dollar.
“I don’t believe that there is a need for a global currency. The reason the dollar is strong right now is because investors consider the United States the strongest economy in the world with the most stable political system in the world,” he said.[/blockquote]