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Goodbye US Dollar as World's Reserve Currency


Spurious George

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Bye :st

Around the Markets: Jim Rogers moving assets out of the dollar and buying the yuan

Jim Rogers, the chairman of Beeland Interests, said he is shifting all his assets out of the dollar and buying Chinese yuan because the U.S. Federal Reserve Board has eroded the value of the U.S. currency.

"I'm in the process of - I hope in the next few months - getting all of my assets out of U.S. dollars," said Rogers, 65, who correctly predicted the commodities rally in 1999. "I'm that pessimistic about what's happening in the U.S."

Rogers, delivering a presentation Tuesday at an investors' meeting organized by ABN Amro Markets in Amsterdam, said he expects the yuan to quadruple in the next decade and that he is holding on to commodities like platinum, gold, silver and palladium.

The dollar has dropped against all the 16 most actively traded currencies except the Mexican peso this year as slowing growth and the first interest-rate reduction since 2003 last month dimmed the allure of dollar-denominated assets.

Since the Fed lowered U.S. interest rates Sept. 18, the first cut in four years, the dollar has fallen 2.8 percent against the euro and touched a record low Tuesday. Gold rose to a 27-year high and platinum jumped to a record.

"It's the official policy of the central bank and the U.S. to debase the currency," said Rogers, a former partner of George Soros.

"The U.S. dollar is and has been the world's reserve currency, the world's medium of exchange," he said. "That's in the process of changing. The pound sterling, which used to be the world's reserve currency, lost 80 percent of its value, top to bottom, as it went through the whole period of losing its status as the world's reserve currency."

The Chinese currency, known as the renminbi, or yuan, is "the best currency to buy right now," Rogers said. "I don't see how one can really lose on the renminbi in the next decade or so. It's gotta go. It's gotta triple. It's gotta quadruple."

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Greenspan: Euro Could Replace Dollar

U.S. Federal Reserve Bank Chairman Alan Greenspan has warned that the dollar’s days as the world’s reserve currency may be numbered, and that a trend to replace the dollar has already begun.

Though some have speculated this is an inevitability, these predictions, published September 20 in a German magazine, are particularly shocking considering their source. Greenspan was the central banker responsible for overseeing the dollar’s value for over 18 years up until 2006.

In the interview published in Stern magazine, Greenspan said it was “absolutely conceivable that the euro will replace the dollar as reserve currency, or will be traded as an equally important reserve currency.”

If the former chairman’s words prove true, the dollar’s present downward slide will continue. Greenspan noted that at the end of 2006, two thirds of all currency reserves were held in dollars, as opposed to 25 percent for the euro. If central banks continue to increase euro proportions at the expense of the dollar, demand for the dollar will fall and excess dollar supplies could start flooding the market.

In fact, this trend is already under way, as evidenced by the recent breakdown in the dollar’s value. In recent months, the dollar has hit all-time lows against the euro and multi-decade lows against many other currencies. The dollar has also reached new lows against oil and wheat, and a 28-year low against gold.

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"Get out of the dollar, teach your children Chinese and buy as many commodities as you can." - Jim Rogers

Edited by McNuclearWar
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Well the Australian dollar is around 91 U.S cents now. A few years ago it was worth less than 50 U.S cents.

Makes things a lot cheaper when we go on holiday there.

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Jim Rogers has been preaching the same thing for so many years he may eventually get it right.

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I suppose the OP supports all of the terrible environmental degradation being done to China, in their attempt to suppress opposition by allowing a hugh influx of foreign capital.

Says a lot about where he stands. Just rip the place up, and let me have my gains. To hell with their quality of life. I just want to shill for some trader. LOL!

He does not even say how much unwanted pressure lower $ value puts on other currencies. To heck with them!

To heck with the U.S.! OMG- HOW STUPID!

Just trying a cheap shot to incite?

Says a lot about your AGENDA- TALK DOWN THE U.S.

How about we talk about your country? Dare to try?

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well yeah the only reason why china is doing so well is thanks to worker and environmental exploitation on a level unseen before. Its a rock and a hard place for the rest of us

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I suppose the OP supports all of the terrible environmental degradation being done to China,

It is a problem of course. But are you saying they should stay as a third world country and live in poverty in order to help the environment while we continue to live our luxuriant lifestyles?

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well yeah the only reason why china is doing so well is thanks to worker and environmental exploitation on a level unseen before. Its a rock and a hard place for the rest of us

I'm not sure. I think such exploitation happened in the West at the turn of the industrial era.

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we want cheap goods, cheap labor, gas, that is what we get, those who in charge couldnn,t care less how we live, or anyone else for that matter, only money counts

Edited by aztek
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I think that the ruling party elite have put aside many environmental concerns, in the name of their own personal gains. Some of those gains go into military expansion. Some go in to all sorts of corrupt party schemes. They admit as much.

I am for balanced growth. That includes precautions about air, land, and water quality. They have been through major problems with their main rivers, and what goes untreated.

The Olympics are to be held in a city that is so polluted, Bejing, they don't know how to manage exposing outdoor runners, or others to the air.

Alot of that is because they won't install simple scrubbers on some of their coal stacks. At this time, I don't know details on what steps they plan, but, for now it's a big problem.

China used to be known for its ideals about nature and harmony. There are responsible planners, but, more is needing to be written into law.

I don't want to see anyone live in degrading circumstances. But, the idea that they will play catch up to clean up in ten or twenty years, sounds implausible. They are growing 7-9% GDP, and that's too fast for a country with so many farming communities. Going industrial has a price.

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Isn't Jim Rogers the one who claimed we are in a recession? one thing that comes to mind about this is that the Chinese yuan is pegged heavily on the dollar. China enjoys an unfair advantage in world markets: the artificially low exchange rate of its currency, the yuan.

U.S. "undoubtedly in recession": Jim Rogers

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now i'm not an economist or particularly knowledgeable regarding such things

*but*

wouldn't a lower US dollar be better for the country in the long term? sort of reawakening US industry?

i know in australia that the high AUS dollar is hurting manufacturing and other exports which much of our economy is based around?

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now i'm not an economist or particularly knowledgeable regarding such things

*but*

wouldn't a lower US dollar be better for the country in the long term? sort of reawakening US industry?

i know in australia that the high AUS dollar is hurting manufacturing and other exports which much of our economy is based around?

I think a weak currency has its advantages and disadvantages. but pegging it at a certain rate for about 10 years is just unreal. Canada would love to have its currency the same or just below the U.S. dollar. it does help with exports but at the same time it hurts investment in the dollar along with higher commodity prices such as oil, cotton and metals.

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