China keeps on pushing the Yuan as world reserve currency, now Argentina

[hugolp]

China is alredy testing the Yuan to commerce with other asian countries and Rusia ( http://www.marketskeptics.com/2009/01/china-expanding-yuan-settlement-trials.html ).

Now it has started in South America. In Argentina ( http://www.lanacion.com.ar/nota.asp?nota_id=1113735&pid=6132877&toi=6259 sorry its in spanish, did not had another source ).

EDIT: Found it in english: http://www.marketwatch.com/news/story/China-Argentina-settle-trade-yuan/story.aspx?guid={9229A1CC-3B26-4694-A82C-1D24927C4433}

 

[pmbug]

The writing is on the wall for the dollar.

 

[hugolp]

Indonesia too.

Indonesia swaping with China too: http://www.bisnis.com/servlet/page?_pageid=127&_dad=portal30&_schema=PORTAL30&vnw_lang_id=1&ptopik=ENG&cdate=25-MAR-2009&inw_id=664255

Indonesia is expected to reduce its dependence on the US dollar in international transactions in order to prevent the rupiah from being volatile.

Therefore, the central bank (BI) will seek to establish more bilateral currency swap arrangements (BCSA) like it did with People's Bank of China. To the purpose, the central bank will eye countries with which Indonesia have big-scale trade transactions.

And China is selling itself as the solution for the crisis and promoting currency swaps: http://en.ce.cn/Business/Macro-economic/200902/16/t20090216_18219374.shtml

 

[rpfan2008]

Sci-Tech sector is totally under Western control, as far as my knowledge goes.

What if..

1. China sells out too many Yaun to these countries in a matter of few years.
2. US starts to deprive these countries of hi-tech products (chiPs/ machinery/electronic technologies etc.)
3. Puts a condition that, US will sell them only against Yaun. And using this process manages to collect lots of their currency just like China have the T-bills right now?

And US is a 'world leader' in tech-denials and such...

 

[Arklatex]

War with china? The longer we wait the harder it'll be to knock them off the map.

 

[rpfan2008]

^ You are wrong.

If US starts playing the same game China is playing via it's proxies it won't be that hard. But it will take some time.

 

[zach]

So what happens if the rest of the world trades with China's yuan and not our dollar?

 

[hugolp]

So what happens if the rest of the world trades with China's yuan and not our dollar?

Arround 70% of the dollar monetary base is outside the US. What do you think it would happen if the US monetary base more than triple in short time?

 

[rpfan2008]

So what happens if the rest of the world trades with China's yuan and not our dollar?

Soon they will have to envy your iPod 2.0s and Windows 9x (?) and all other tech gizmos.
Iraqis were even deprived of basic medicines and stuff, but this time at least someone will supply those.

 

[Original_Intent]

Well, it's not Zimbabwe, but $5+ loaf of bread still sucks.

 

[hugolp]

Well, it's not Zimbabwe, but $5+ loaf of bread still sucks.

No, no. That is just the monetary base. You have to add there the fractional reserve multiplier.

 

[shaunish]

moar on this topic

http://www.telegraph.co.uk/finance/...-Gold-Standard-to-solve-financial-crisis.html

quote:
"China's government has floated a variant of this idea, suggesting a currency based on 30 commodities along the lines of the "Bancor" proposed by John Maynard Keynes in 1944."