China’s wanting to dump the dollar as the world’s (and its) reserve currency. 
Now, I’ve been wondering about the whole inflation/deflation thing.
We’re creating entire US budgets’ worth of dollars out of thin air in order to provide liquidity. Fine. As a percentage of GDP, we’re still not (I think) at the level we were during, say, WWII, so no biggie, right? However, ultimately, if the Fed fails to sop that stuff back up, it will mean inflation or hyperinflation. That’s when the value of the dollar craters.
On the other hand, while that knowledge of impending craterage should have caused sane investors to flee the dollar, in the face of a global crisis, everybody’s bought dollar-denominated assets as a safe haven. That’s kept the dollar strong.
But now, China seems to be saying they don’t see the dollar as a long-term safe haven. Want to replace it with something else. I don’t know how likely that is to come to fruition soon, but the indications look like that strong dollar’s about to fall off a cliff.
Where’s all the foreign investment gonna go instead of dollars for the next few years (or more) until the SDR regime’s adopted? I dunno, how about commodities? Your guess is as good as mine, I suppose. It’s still dollars for now, as for the moment, the $100 trillion beast that is the global buyers of government bonds has nowhere else to go — but China, at least, very desperately wants to go elsewhere.
Game. Set. Match. Just think, it was only a handful of years ago when anyone who talked about the US dollar going under and being removed as the worlds reserve currency were shouted down and mocked. I’d love to see all those people who said “There is no way China will get rid of their dollar assests because it would destroy them as well” explain this away.
…and now the Czech President says that Obama is leading the US “on the road to Hell” with his economic policy.
All these Socialists can’t be wrong when advising their wannabe socialist brother, could they/
That’s what this reminds me of. Gang behavior. Obama, the wannabe gangster, is trying to achieve initiation in the Socialist Club, so he is demonstrating his creds (kill something, in this case, the world’s largest economy).
Meanwhile, the established gang members, who have it pretty good in their socialist-quasi-capitalist economies, don’t want him to upset their territories.
Yep, Obama’s a kid from Chicago, and he learned his gang behavior at Daley, Jr’s knee. He’d go far in the Chicago mob, but in the Socialist Gang?
I’m not betting on it.