Author: notknowwhy

China Urges New Money Reserve to Replace Dollar! [Copy link] 中文

Rank: 4

Post time 2009-4-3 14:31:44 |Display all floors
China doesn't actually expect all the countries in the world to agree on a new reserve currency. Indeed, if China really wanted to force the issue, then as idiot8 mentioned, it could already single-handedly eliminate the dollar as the world's reverse currency. But now is not really the best time for that. Rather Zhou's proposal is more akin to "laying the groundwork" or "preparing the battlefield" for future changes which ARE coming. Everyone knows the US will print money to finance its stimulus spending. There simply aren't enough entities willing to lend the US the funds. And the US is utterly unwilling to cut spending. Over the next few years you'll see a slow rollout of a number of measures that will redirect China's capital back into the domestic market. Primary amongst those will be the expansion of the domestic fixed income (bond) market. You're already seeing some of that with the rapid expansion of the MTN market. Large scale issuance of government debt is also on the horizon. I'd expect capital haircuts for PRC financial institutions' holdings of foreign denominated assets to occur sometime afterwards.

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Post time 2009-4-6 09:11:07 |Display all floors
I  approve of zhou xiaochuan' proposal,as long as a new current is created ,I believe the world financial system will be more stable and practical ,just release a new international currency ,controlled by the IMB,or  as the world is shrinking increasingly and rapidly ,we can concel all the current denomination,the world mere has one currency.

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Post time 2009-4-6 12:50:34 |Display all floors

Reply #28 totothedog's post

well, it would still mean relative value of Rmb to the US$ to keep China's exports competitive.

However for states that sell a lot to China and imports the same from China, it would be beneficial.
It would help expand trade. (same as lending IMF to issue SDR)
However, it will have minimal impact on US$ as global forex leader.

The European, British Club, USA, Trade Route states are still 80% of the world's trade.
but it's significant for China, as long as it does not inflate the value of the Rmb.


Green DRagon
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Note: Mr. Toto, China is not that developed yet, in terms of logistics, pipelines, car, income, recreation etc.

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Post time 2009-4-7 04:08:39 |Display all floors

Ya replace the greenback!!

China must lead the world! Soon US dollars will be like Japanese banana notes after the second world war!!

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Post time 2009-4-7 12:00:48 |Display all floors

Reply #32 totothedog's post

You remind me of the Amerikan Movie, i think it's "police movie".....Clint Eastwood!!!!!!


Green DRagon
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Post time 2009-4-7 12:05:34 |Display all floors
China still has long way to go .

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Post time 2009-4-8 17:38:08 |Display all floors

money is king???

in our mind, with money  you become a king, in fact, it's not so true in the global economic society.  so many dollars reserve we got , but it's paper except we actually use them on our economy's developing.  or, you just a shareholder but not a really boss.  CHINA couldn't be the US's boss in the current monetary syestem, never! never!...

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