[SeaGypsy]

It can't simply be a matter of faith or an international summit would have already collapsed the dollar in response to QE mark 1,2,3 Infinity. It really is a matter of there not being any viable functioning alternative.

Edit to add: in order for a 'faith collapse' to occur- there would have to be a viable alternative singular nobody wants to have to buy a basket of god knows what currency in order to trade- a basket of basket cases is what such would amount to if enacted tomorrow morning. What will it take to not just create a new global currency but for it to garner the requisite faith? Moses may have been able to achieve moving mountains.

[radon1]

Dethroned implies that someone will take the throne. Reserve currency is only needed when there is international trade. The reserve currency should be able to buy anything that the buyer may ever need. Except the dollar, there are only two currencies that can more or less provide that now - euro and yuan. Does any of them look more reliable then the dollar? Hardly.

Another alternative - gold/silver. But this is archaic, and may work if the world slides to archaism.

[SeaGypsy]

People keep saying that about Euro and Yuan, but it's not at all realistic- they don't have the scale. Maybe in 10 or 20 years, but what's the world going to be like then? The US economy dwarfs all others in isolation.

Edit to add: Gold would have to become many times more expensive than it is now to have any chance of replacing reserve, the insane rise involved would itself create massive instability. Silver is too abundant in too many places for stability and would suffer the same fate- just with bigger 'coins'.

[americandream]

$this->bbcode_second_pass_quote('SeaGypsy', 'P')eople keep saying that about Euro and Yuan, but it's not at all realistic- they don't have the scale. Maybe in 10 or 20 years, but what's the world going to be like then? The US economy dwarfs all others in isolation.

Edit to add: Gold would have to become many times more expensive than it is now to have any chance of replacing reserve, the insane rise involved would itself create massive instability. Silver is too abundant in too many places for stability and would suffer the same fate- just with bigger 'coins'.

[Ron Patterson]

SeaGypsy wrote:$this->bbcode_second_pass_quote('', 'H')ow long a digital conversion takes is irrelevant to anything worth considering. .3% of $1000 is a cup of coffee. .3% of $5 trillion is more than most countries GDP- a heck of a lot of money for jam.

[careinke]

$this->bbcode_second_pass_quote('SteveO', '')$this->bbcode_second_pass_quote('Ron Patterson', '&')quot;
The dollar will likely remain the world's benchmark currency unless we have a massive inflation of the dollar. If that happens then the world will have to find another benchmark currency.

[SeaGypsy]

$this->bbcode_second_pass_quote('Ron Patterson', 'S')eaGypsy wrote:$this->bbcode_second_pass_quote('', 'H')ow long a digital conversion takes is irrelevant to anything worth considering. .3% of $1000 is a cup of coffee. .3% of $5 trillion is more than most countries GDP- a heck of a lot of money for jam.

[americandream]

$this->bbcode_second_pass_quote('SeaGypsy', '')$this->bbcode_second_pass_quote('Ron Patterson', 'S')eaGypsy wrote:$this->bbcode_second_pass_quote('', 'H')ow long a digital conversion takes is irrelevant to anything worth considering. .3% of $1000 is a cup of coffee. .3% of $5 trillion is more than most countries GDP- a heck of a lot of money for jam.

[radon1]

$this->bbcode_second_pass_quote('SeaGypsy', 'P')eople keep saying that about Euro and Yuan, but it's not at all realistic

[SeaGypsy]

Which would require just on it's own, massive volume increase, huge improvement in stability of the floating Euro, a serious float of the Yuan, etc. None of which is going to happen overnight.

[Keith_McClary]

$this->bbcode_second_pass_quote('SeaGypsy', 'H')ow many of the 2 posters it took to decimate this billionaire's argument are billionaires? (or even millionaires) Makes me wonder how stupid people become so rich.

[americandream]

$this->bbcode_second_pass_quote('radon1', '')$this->bbcode_second_pass_quote('SeaGypsy', 'P')eople keep saying that about Euro and Yuan, but it's not at all realistic

[americandream]

$this->bbcode_second_pass_quote('Keith_McClary', '')$this->bbcode_second_pass_quote('SeaGypsy', 'H')ow many of the 2 posters it took to decimate this billionaire's argument are billionaires? (or even millionaires) Makes me wonder how stupid people become so rich.

[radon1]

$this->bbcode_second_pass_quote('SeaGypsy', 'W')hich would require just on it's own, massive volume increase, huge improvement in stability of the floating Euro, a serious float of the Yuan, etc. None of which is going to happen overnight.

[SeaGypsy]

Put very simply Radon; there is too much to lose for too many of the most powerful and richest. Without fail, every country which tries to undermine Dollar hegemony faces some degree of sanction for doing so. China and Russia are only getting away with it for very obvious reasons- cheap labor on the one hand and plentiful oil on the other. The Dollar will be defended in it's position at all costs- especially to everyone else.

[americandream]

Radon

The commercial world has devised a variety of means for ensuring that Western capital gets to the Chinese dividends beast without locking in substantial amounts of that liquidity within that risk profile, long term. One has to remember that on day one of the tie up with China, the previous day, saw a China an isolationst state with no ties to capital. From those roots have sprung a variety of mechanisms to ensure that China is capitalised to deliver dividends within that risk profile.

Likewise with oil contracts. Particular contracts will be suited to direct exchange. Western capitalists will be sanguine as China's easy access to energy ensures that its dividends capacity works efficiently. However, other contracts will continue to use the financing arrangements that have been devised for that particular risk market.

Of couse, certain commentators who are not focussed on risk profiling countries will jump to conclusions from the superficials. But to suggest that risk free America is about to have its currency supplanted by China dispalys a clear misunderstanding of the pecking order in global capitalism, one which will remain robust until the system confronts its own dialectic forces (Switzerland remains another haven, albeit one that lies dormant in this upbeat phase of globalism).

[radon1]

$this->bbcode_second_pass_quote('SeaGypsy', 'P')ut very simply Radon; there is too much to lose for too many of the most powerful and richest.

[americandream]

Another thing you need to remember is that this system has always been speculative. Large pools of capital tend to move much quicker than smaller, more investment oriented ones. Speculation is what funded colonial English investment in the as then risky American frontier.

It was easier to integrate America within England's emerging social economy, for obvious reasons. And of course, with America being so well endowed resourcing wise, it was quickly in the co-pilots seat and defining the new orders identity.

Later on, efficient mercantilists such as Germany and Japan etc, etc joined these capitalists and merged their fortunes with the capitalist mode of accumulation. This process is ongoing and called globalisation.

[americandream]

The only reason America could disappear is as a consequence of the system's (capitalism) rationale moving beyind its Anglo-Saxon roots to a new mode of accumulation that does not use Anglo-Saxon legal forms (culture).

In other words, the system would have moved beyond capitalism whilst still remaning true to the process of accumulation, the dialecticism that Marx refers to. What that might be is anyone's guess. If accumulation were to remain the core driver, then any mutation will be adding another layer to the process beyond the form and substance of Anglo-Saxon law. I cannot see how mercantilism could improve on capitalism (China and the EU replacing the Anglo-Saxon world) as capitalism is essentially mercantilism plus. So I am at someting of a loss. If America were to fall victim to violence, I suspect decoupling would be underway and spell the end of accumulation.

The only real substantive realignment of modernism (and I mean technological prowess which is not of capitalism but of Reason (although many see capitalism and modernity as one)) would be in a cultural form and more likely than not include the reinstatement of collectivism, a cultural form under which we evolved. We also risk complete collapse with the climate elephant thundering in the background.

[AdamB]

$this->bbcode_second_pass_quote('', '
')The government of Iran imposed new restrictions on the use of the US dollar in the country. The use of the US dollar for import operations in the Islamic Republic of Iran has been banned from February 28, Forbes reports with reference to Iranian media. Starting from February 28, any supply orders or other import declarations where US dollars are used will not be processed by the Iranian customs authorities. According to Mehdi Kasraipur, the director of Foreign Exchange Operations and Policy Department of the Central Bank of Iran, the new rules should not affect current trading operations much, given that the use of the American currency in Iran was already limited. Iranian banks could not conduct operations in US dollars because of US sanctions. "Given that the use of the dollar in Iran is already prohibited, traders use alternative currencies in