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Greenspan Says Euro Could Replace U.S. Dollar As Favored Reserve Currency

Discussion in 'Political Discussion' started by Real World, Sep 17, 2007.

  1. Real World

    Real World Moderator Staff Member

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    I've thought about this for a number of years now, but more so since the talk of a possible North American Union and it's "Amero" currency. The reason why the Euro is moving toward replacing the dollar, is not simply because of value, but because of it's wide spread usage. Before, the dollar competed with a multitude of European currencies, whereas now, it does not. Therefore global currency has become much like politics in this country. It's become a choice of Coke or Pepsi. Plus, the Euro is the currency for multiple nations while the dollar is basically used in one. I think this is why you see more chatter about a NAU & Amero. Some fear that the US could move to second fiddle. Personally, I couldn;t care less if we move to the back of the bus globally, as long as we are happy here at home.

    AP
    Greenspan: Euro Gains As Reserve Choice

    Monday September 17, 8:07 am ET

    Report: Former Fed Boss Says Euro Could Replace U.S. Dollar As Favored Reserve Currency

    FRANKFURT, Germany (AP) -- Former U.S. Federal Reserve chairman Alan Greenspan said it is possible that the euro could replace the U.S. dollar as the reserve currency of choice.
    According to an advance copy of an interview to be published in Thursday's edition of the German magazine Stern, Greenspan said that the dollar is still slightly ahead in its use as a reserve currency, but added that "it doesn't have all that much of an advantage" anymore.


    The euro has been soaring against the U.S. currency in recent weeks, hitting all-time high of $1.3927 last week as the dollar has fallen on turbulent market conditions stemming from the ongoing U.S. subprime crisis. The Fed meets this week and is expected to lower its benchmark interest rate from the current 5.25 percent.

    Greenspan said that at the end of 2006, some 25 percent of all currency reserves held by central banks were held in euros, compared to 66 percent for the U.S. dollar.
     
  2. scout

    scout Veteran Starter w/Big Long Term Deal

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    #15 Jersey

    Isn't that what Saddam did that pissed everyone off. I'm a little fuzzy on it, but remember some talk about that.
     
  3. maverick4

    maverick4 Banned

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    I posted a year ago about this.

    Reserve currency is mostly about oil/petrodollar warfare. Since Nixon, the dollar has been the world's reserve currency because back then the US convinced OPEC and the Saudis to only trade oil in dollars, forcing everyone on the earth to stockpile dollars.

    Saddam was the first to change to the Euro in 2000, and 3 years later we invaded and changed it back to the dollar. Now Iran is going to launch its oil bourse market and trade in Euros, same with Venezuela in the near future.

    These events, coupled with the fact that the US has massive debt and a trade deficit, does not make the dollar an attractive reserve currency anymore.

    The Euro WILL become the world's reserve currency, for about 5 or 10 years. However, according to Jim Rogers, the EU isn't exactly stable and the reserve currency might shift to the Yuan in about 20 years.
     
  4. Real World

    Real World Moderator Staff Member

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    The Yaun is far too manipulated to ever be taken seriously. The EU might very well implode, especially since it's adding far too many members with different ideologies. The problem for the dollar, besides the issues you mentioned, is the consolodation of nations that the Euro now represents. I wouldn't be surprised if the EU disolves in 15 years, but keeps the common currency. To me, I don't the issue in using a different currency to buy oil. Afterall, at some point in the next 30 years, we probably won't be using oil as the #1 fossil fuel. At least I hope we won't be.

    As an aside, I find it interesting how some people would prefer to invade a nation, or create an NAU with it's Amero, than simply balance books, decrease government, stay independent, and find an alternative fuel source.
     

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