Tags: Dollar | losing | Reserve | Status | china | yuan | economy

Dollar Loses a Little More Status in the World

By    |   Monday, 14 Feb 2011 01:33 PM

Inch by inch, the dollar is moving closer to losing its world’s reserve currency status.

The International Monetary Fund (IMF) recently released a report entitled, “Enhancing International Monetary Stability: A Role for the SDR.”

In the report, the IMF outlines the problems that it sees with the dollar being the reserve currency for the world and the potential benefits of using their SDRs (Special Drawing Rights). These SDRs have been around for a while now. In short, they are simply a basket of currencies contained within one financial instrument.

Join the Robber Barons Next Door. Your Potential Reward: $137,000 (or more) Legally in Your Pocket in the Next Year Alone!

In following the IMF on this matter for a while now, I can see that they want these SDRs to at least be used to bridge a gap between the U.S. dollar as the reserve currency and the next major currency to hold the title. (In my opinion, this eventually could be the Chinese yuan.)

But back to the IMF’s thoughts for a moment …

IMF officials believe that these SDRs could be used in global trade between countries and it would help to smooth out the bumps associated with the wildly fluctuating exchange rates that the world presently experiences with using the greenback as the main medium of exchange.

These SDRs, which are really a synthetic currency of sorts, presently is made up of 41.9 percent U.S. dollars, 37.4 percent euros, 9.4 percent yen and 11.3 percent British pounds.

Russia has now called for the BRIC nations (Brazil, Russia, India and China) to be included in this basket of currencies that make up the SDRs.

China, individually, has made a push for the yuan to be included in this basket too. However, the IMF has initially told them that they won’t do that until the yuan is a free-floating, freely tradable currency. (Of course, Brazil is in the same boat as China in this regard too).

So here are my final thoughts on this matter for now…

The IMF actually wouldn’t mind these SDRs becoming the world’s permanent reserve-currency mechanism. That could eventually create the need for a one-world government, a one-world central bank and a one-world currency. Sounds like the Book of Revelation doesn’t it?

I believe something like this could eventually become a reality. It’s really simply a matter of timing. Does it happen in our lifetime or not? “Who knows?”would be the correct answer. But we do know that they are pushing for it to at least be a temporary bridge between the phasing out of the buck as the reserve currency and the next reserve currency.

No matter what happens, the overall sentiment through the years will only continue to worsen and everyone and their mama seems to be building a case against it.

In fact, President Barack Obama has stated that his administration “fully supports the eventual inclusion of the yuan in the SDR.”

So even he is really providing more clout to the thought of SDRs. In the end, it’s just one way: he and his administration are undermining the buck longer-term.

About the Author: Sean Hyman
Sean Hyman is a member of the Moneynews Financial Brain Trust. Click Here to read more of his articles. He is also the editor of Money Matrix Insider. Discover more by Clicking Here Now.

© 2017 Newsmax Finance. All rights reserved.

   
1Like our page
2Share
SeanHyman
Inch by inch, the dollar is moving closer to losing its world s reserve currency status. The International Monetary Fund (IMF) recently released a report entitled, Enhancing International Monetary Stability: A Role for the SDR. In the report, the IMF outlines the...
Dollar,losing,Reserve,Status,china,yuan,economy,us,sean,hyman
559
2011-33-14
Monday, 14 Feb 2011 01:33 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved