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+--- Thread: Why would China think a new currency would be safer than the dollar? (/showthread.php?tid=75427)
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Why would China think a new currency would be safer than the dollar? - Dennis S - 03-31-2009
Talk about risky.
Re: Why would China think a new currency would be safer than the dollar? - JoeH - 03-31-2009
What new currency are you talking about? About the only thing the Chinese have mentioned was the possibility of setting contract prices based on an index calculated based on several of the stable currencies such as the dollar, yen and euro.
Re: Why would China think a new currency would be safer than the dollar? - Dennis S - 03-31-2009
http://www.google.com/hostednews/afp/article/ALeqM5hPVetfLOSiNdHDRFuDna-J4SVT7w
OK. It says in here it would be a basket of currencies:
http://capital-en.trend.az/economy/macro/1447694.html
Re: Why would China think a new currency would be safer than the dollar? - Mac1337 - 03-31-2009
Dennis S wrote:
http://www.google.com/hostednews/afp/article/ALeqM5hPVetfLOSiNdHDRFuDna-J4SVT7w
OK. It says in here it would be a basket of currencies:
http://capital-en.trend.az/economy/macro/1447694.html
Would we call it a basket case then?
Re: Why would China think a new currency would be safer than the dollar? - ajakeski - 03-31-2009
Will they call it the dorrar?
Re: Why would China think a new currency would be safer than the dollar? - Black - 03-31-2009
ajakeski wrote:
Will they call it the dorrar?
I didn't think it was possible, but you made Dakota look classy by comparison. Good work.
Re: Why would China think a new currency would be safer than the dollar? - Black - 03-31-2009
Dennis S wrote:
Talk about risky.
Re: Why would China think a new currency would be safer than the dollar? - Acer - 03-31-2009
I read about this (too lazy to find a link). Some sort of instrument cobbled together by the International Monetary Fund, for instance. Of course, just creating a currency by fiat does not make it stable.
Re: Why would China think a new currency would be safer than the dollar? - RgrF - 03-31-2009
Stable is as stable does. It's all a matter of agreement. If we create a new currency called the zlotney and we all agree it's of value, it becomes of value.
The reason the US dollar has held any value is that other currencies were perceived as weaker, that perception is changing and something will replace it.
Re: Why would China think a new currency would be safer than the dollar? - Acer - 03-31-2009
There's more than just belief involved. The U.S currency was attractive because of very real, measurable factors: our large and productive economy with a stable government implied that it would retain its value without inflating or deflating excessively, through bad times and good. Yes, there's a measure of faith here, but there's also a huge GDP, for example, to support that faith.
How do you create that out of nothing? Sure, our governments can "agree" that the zoltney "shall be stable" but you can't force the markets to agree.