UN committee this week new world reserve currency advice
Sunday, March 22, 2009
A panel of financial experts UN next week the opinion for a new global reserve currency for the world to create, and the U.S. dollar this final to take. The implications of this opinion can be huge, not only will the dollar may sink even further, but so is the long awaited one-world currency in this way a step closer.
The new world reserve currency, according to one of the experts, currency specialist Avinash Persaud, is modeled along the lines of the old ECU, the European Currency Unit, the forerunner of the euro. Persaud, chairman of Intelligence Capital consultants and a former chief executive at JP Morgan, said that the opinion of many would be on March 25 by the UN Commission of Experts on International Financial Reform at the UN will be given.
"This is a good time to reserve a common currency to be introduced," said Persaud. The U.S. dollar has for decades seen as a safe haven, but is increasingly under pressure because of the huge U.S. debt and rapidly rising budget deficits.
Russia has already announced during the G-20 summit in April with a proposal to make a new reserve currency creation. The Russians have in recent years the share of dollar in their foreign currency reserves have significantly reduced.
The new reserve currency will initially consist of a mix of several major world currencies like the ECU consisted of the main European currencies.
Record val Dollar Index
The dollar index, the performance of the currency against other major currencies (euro, yen, pound, zw.franc, can.dollar) displays, fell yesterday after the announcement that the Fed starts buying up U.S. bonds, with 2.7%, the biggest one day decline since 1971. The decline against the euro on a single day has never been so strong.
The expectation of some analysts that flood the market with billions of dollars that are created out of nothing, will ultimately lead to hyperinflation, it is increasingly likely. China, the biggest financier of U.S. debt, buy fewer U.S. government bonds on. A sign on the wall, just as the U.S. always needs more money to the very expensive bailouts, stimulus packages and further plans of President Obama to be funded.
A world currency
The recent decision of the International Monetary Fund (IMF) for the coming months for a value of hundreds of billions of dollars so-called "special drawing rights to be issued, designed to prevent deep global recession is a depression-is a clear signal that major changes in the global financial system will be needed. These 'special drawing rights are also known as a "super-world currencies, and according to some analysts that big danger with it: hyperinflation, but across the world.
It is not unlikely that the G-20 summit decided that indeed a new world reserve currency to be created, possibly under the auspices of the IMF. With the creation of this joint reserve currency, the step then to a real currency, as the Euro resulted from the ECU, ever closer.
Source: xander news