The new Reserve??

[Aman A.K.A. Ahamburger]

There has been lots of speculation on China's ability to even get it's currency to reserve status. Things aren't looking good right now for the Chinese.

Fitch Warns on China Liabilities:
blogs.wsj.com/marketbeat/2011/04/12/fitch-warns-on-china-liabilities/?mod=google_news_blog

[verrip1]

"It said that it “sees a high likelihood of a significant deterioration in asset quality in the Chinese banking system in the next three years,” with risks concentrated in property loans and lending to local government financing vehicles."

(my emphasis)

There ya go. Everybody's worried about what China will do economically to the US, and look at this! China 2011 is US 2008.

[Virgil Showlion]

No respectable blogger has ever given weighty consideration to a Chinese world reserve currency.

[decoy409]

Trust me,this situation has been addressed as to what if, and has been worked on long before this old stuff (2002). Why there is even a bonus feature for investors,

Quote: IMF proposes nation bankruptcy plan
www.allbusiness.com/accounting/3486679-1.html

Everything will be just fine.....

[texasredneck]

If China wants to be the worlds reserve currency it would not be difficult. They can just continue buying gold with their U. S. Bonds and dollars. At some point they would become the strongest currency in the world.

[jarhead1976]

Yes I posted this on another thread... I also said in the future ....( Relative) ......"To all those who claim that China is perfectly happy with the status quo, in which it is willing to peg the Renmibni to the Dollar in perpetuity, this may come as a rather unpleasant surprise, as it indicates that suddenly China is far more vocal about its intention to convert its currency to reserve status, and in the process make the dollar even more insignificant." ..... also found this!.... They are also looking at what is called a "dim sum bonds"... Source Wall Street Journal. purchased only in the Yuan! Embraced by CAT and McDs. Personally I do not see it being any more than a secondary reserve currency... IMO

[decoy409]

Jarhead, how ya doing!? Say that is intriguing, McD's that is.

Say if you had a oppurtunity to have as much of and anything you wanted,and it costed you keeping your mouth shut,would you take the payday? That is just a fun question.

Did you read the 2002 IMF news above? I have been watching the behind the scenes and just keeping a thoughtful little track of things as you know. Kept this one in my magic hat.

Quote: Max Keiser US Dollar is Finished


Just a little 'Food for thought' as another says.

[itstippy]

Mature economies can continue to count on China to be the engine of global economic growth though, right? I mean, this little Chinese banking matter is nothing more than a fly hitting the windshield of a locomotive.

Right?

[jarhead1976]

Hello decoy , Yes I did see the your post about The IMF and the bankruptcy issue. Maybe they will let us off the hook for the $900 billion (US Bonds debt), we owe china. Its like the yellow prick road around here , better hope them bricks are Gold. Thing's are good thanks for asking. Respects

[decoy409]

jarhead,combine this thought from April 11,2011

Quote: April 11, 2011 – There is no question that a weakened dollar is fueling the rising price of gold, and no question as to why the dollar is sinking. At least one would think. But as the government squabbled over minute cuts last week, cuts that would not impact the real problems in the slightest, headlines across the country proclaimed that the threat of government shutdown is sinking the dollar. Come again?

Sure the idea that idiotic bickering could bring the great US Government to its knees didn’t help our image any, but does anyone really think that to be a significant cause of ever growing investor confusion and falling confidence in the Fed? How about the fact that the Fed has dumped another half trillion dollars into an already bloated monetary base this year while the ECB and other central banks around the globe have tightened policy to hold off inflation and stabilize their currencies – might that have something to do with it?

In a commentary in Rasmussen Reports, Lawrence Kudlow attributes the 15% drop in the dollar index over the past 10 months to the obvious: “That's because there are too many of them.” The natural consequence of that should be equally obvious: Bernanke’s policies are “falling further and further behind the international curve of currency stability.”

Kudlow further points out the uncertainty caused by dollar inflated energy prices, because “nobody knows where the energy tipping point is.” That might well be the key.

On one hand we have a “debt bomb” that is armed and could spontaneously explode at any time, the size of which has been greatly underplayed. Bill Gross, founder of PIMCO, told the Wall Street Journal that “including obligations for Medicare, Medicaid and Social Security, the ‘true but unrecorded’ U.S. debt is $75 trillion … nearly 500% of gross domestic product.”

On the other hand we has surging energy prices, a sword of Damocles that could easily set off a chain reaction that the Fed would be powerless to control(end)

Ha,imagine that. I was just pointing these things out as to the IMF and having to devalue the dollar. Like Dad taking the keys from the car away,or taking away the credit card. But in this case it will be the note that was over abused.

[itstippy]

I admit, I don't understand how the Chinese financial system works.

If China's top bankers made a whole shitload of really bad loans, and those loans go sour and tank the Chinese economy, the bankers lose their bonuses for a year, right?

[jarhead1976]

itstippy, almost like the marriage of socialism communism and capitalism... wonder what the divorce will look like?

[verrip1]

Apr 13, 2011 18:40:21 GMT -5 Virgil Showlion said:

No respectable blogger has ever given weighty consideration to a Chinese world reserve currency.

Emphasis - oxymoron.

[jarhead1976]

To funny .... like, Honest Banker.

[workpublic]

jumbo shrimp ;D

[Aman A.K.A. Ahamburger]

Apr 13, 2011 18:40:21 GMT -5 Virgil Showlion said:

No respectable blogger has ever given weighty consideration to a Chinese world reserve currency.

So Virgil how do feel about backing the decay now?

V, post #2..

Not only that but they already have enough property sitting empty to house over 100 million people. They wish they were the USA in 2008.

[Aman A.K.A. Ahamburger]

So if Fitch is looking at serious issues what is the real reason for this. There banking system sure sounds 110% capitalistic to me.

China Reserves Exceed $3 Trillion as Wen Resists Yuan Pressure
www.bloomberg.com/news/2011-04-14/china-s-3-trillion-reserves-show-g-20-task-as-wen-resists-yuan-pressure.html

[verrip1]

Aman re 16:

Let's see, China holds more currency than any other country in the world, per your referenced article. Therefore they are overleveraged in foreign currencies, and economic difficulties in China from excess growth would force them to sell currencies which would then be at a buyer's market price. In turn, the prices of those currencies would tend to drop.

Ergo it is good for the USD to have China buying currencies other than the USD. Q.E.D.!

[Aman A.K.A. Ahamburger]

I luv rational responses.

Hey lets not forget that there is alot of people to feed in china. So a drop in reserves could be a good thing because of things like this.

U.S.'s Sixth-Largest Export Sale of Corn on Record May Be Heading to China:
www.bloomberg.com/news/2011-03-25/u-s-corn-export-sale-sixth-biggest-ever-may-be-for-china.html