Over at Investment Watch, a fine blog about the economy, this recent piece summarizes very nicely the forces working against the value of the U.S. dollar, notably the recent actions by China and other countries. The list of countries doing non-dollar deals is growing.
Argentina and Brazil have reached a non-dollar deal and 4 other S.A. nations will join in non-dollar trade.
China has reached a non-dollar deal with both of those nations, 4 or 5 other nations and is working on one with Malaysia. Other Asian nations are reaching their own non-dollar trade deals.
All of this reduces the number of dollars they need to get rid of. They are also buying with dollars, copper, iron, oil mines, lending dollars to help nations develop new resource finds on the condition that China gets the resource at market prices.
At the same time, IMF bonds are being bought instead of U.S. bonds. China, Russia, Brazil and India are involved:
China, Russia, Brazil, and India are buying IMF bonds instead of U.S. bonds in small quantities with China making the largest purchase of about 50 billion but, that is still $50 billion they can’t lend us then.
Meanwhile, the United Arab Emirates is contemplating a new oil currency.
The author comments that:
The biggest problem China has is that there isn’t enough money in the world to lend the U.S for what it wants to spend. That means the dollar will go down whether China wants it to or not and they know it. That is why they are trying to spend as much as they can without dropping the dollar faster.
Also, recall that Iran has already given up the dollar for its oil deals. Iran’s international news network, PressTV, reported in December 2007 that Iran had dropped the dollar:
Iran has halted all its oil deals in dollars following the recent OPEC proposal to trade crude in non-dollar currencies.
“The dollar is no longer a reliable currency, considering its devaluation and the resulting loss suffered by oil exporters,” said Iranian Oil Minister Gholam-Hossein Nozari.
The post at Investment Watch goes on to discuss the the ramifications of devaluation and possible collapse of the dollar.
So, what’s the average American supposed to do?
Well, since the current financial system is a mess, maybe we should look to the future. Ever hear of the ReincarnationBank?
According to the bank’s website, ReincarnationBank offers “a safe and secure management system for its clients – a place they can leave behind their assets and commodities for their return into the next life.”
How will they know it’s YOU when you come back and want your money?
As in this life, in the next you will have memories of previous lives. One of these recollections will be of your arrangement with Reincarnation Bank. Whatever version of the internet or data retrieval mechanisms in use at the time of your return, you will renew your contact with Reincarnation Bank and through regression you will recall the details/instructions that you left at the time of making your deposit. A custodian of Reincarnation Bank will open your letter privately in your presence and will ask you to repeat the details contained therein (whilst in regression). Once this has been satisfactorily achieved, funds/property will be handed back to you and the account closed.
Of course, in some ways the bank is similar to banks operating in the present:
An indication of interest rates cannot be given at this stage because we cannot forecast how long we will be away. But $1000 or $10,000 invested now will have an added value upon our return.
Heck,I have enough trouble remembering my PIN now…I don’t know if I’ll remember it if I’ve been spending some time as a gerbil…
What if my memory fails me during regression and I forget my former name?? I lose all my cash?
Well, with the way the present-day financial system is operating, maybe I should take a closer look anyway…and learn some tricks to improve my memory!
Money Matters: “Banker to the Poor” In Impoverished Countries Now Lending in U.S.; “Money Goddess” Advises Obama Administration; IMF Bonds Update
Russia-China Proposals; “Rebalancing” Global Currency Reserves: Why the U.S. Can’t Take Anything for Granted Re: the Dollar
The Scanner–International Edition, March 24, 2009: Say Goodbye to the Dollar? China, Russia Proposing a New World Currency for “Non-Credit” Based Economies, Echo G-20 Agenda of Expanding IMF; China Will “Consider” Buying IMF Bonds; 10th China Develpment Forum Underway (UPDATE 1X–Geithner Supports China Proposal??)
Filed under: Current Politics | Tagged: Argentina, Asian nations, Brazil, China, commodities, gerbils, IMF bonds, India, inflation, interest rates, Investment Watch, Iran, Malaysia, new oil currency, New World Currency, non-dollar trade, PressTV, regression, the dollar, the economy, the financial system, The Reincarnation Bank, U.S. Treasury bonds, United Arabe Emirates | 3 Comments »