SeaGypsy wrote: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'.
How 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.
FE Dealers are large commercial banks, which buy and sell FE. Specifically, they are the international departments of large commercial banks in the financial centers of the world: London, New York, Tokyo, Zurich, Frankfurt, Paris, Singapore, Hong Kong, Toronto.
In New York City, there are about 100 such banks.
(ii) Large banks outside the center also participate through their affiliates.
(iii) Small regional banks do not directly participate in the FE market. But to meet their customers' FE need, they deal with correspondant banks. Almost 14,000 commercial banks maintain corresponent relationship with FE dealers.
SteveO wrote:Ron Patterson wrote:"
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.
There is massive inflation (or perhaps dilution is a better term) in the dollar. The M1 shows it. It will take a loss of faith in the dollar to end is position as the benchmark/reserve currency.
The image is too wide, so I'm posting a link to the chart. http://research.stlouisfed.org/fred2/da ... 30_378.png
Ron Patterson wrote:SeaGypsy wrote:How 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.
SeaGypsy, three basis points is not .3% but .03%. And yes that is a lot of money but it is spread over many thousands of banks:FE Dealers are large commercial banks, which buy and sell FE. Specifically, they are the international departments of large commercial banks in the financial centers of the world: London, New York, Tokyo, Zurich, Frankfurt, Paris, Singapore, Hong Kong, Toronto.
In New York City, there are about 100 such banks.
(ii) Large banks outside the center also participate through their affiliates.
(iii) Small regional banks do not directly participate in the FE market. But to meet their customers' FE need, they deal with correspondant banks. Almost 14,000 commercial banks maintain corresponent relationship with FE dealers.
Banks make their money by the spread between the bid and asked price which, as I said, for all major currencies average about three basis points or three cents for every one hundred dollars.
SeaGypsy wrote:Ron Patterson wrote:SeaGypsy wrote:How 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.
SeaGypsy, three basis points is not .3% but .03%. And yes that is a lot of money but it is spread over many thousands of banks:FE Dealers are large commercial banks, which buy and sell FE. Specifically, they are the international departments of large commercial banks in the financial centers of the world: London, New York, Tokyo, Zurich, Frankfurt, Paris, Singapore, Hong Kong, Toronto.
In New York City, there are about 100 such banks.
(ii) Large banks outside the center also participate through their affiliates.
(iii) Small regional banks do not directly participate in the FE market. But to meet their customers' FE need, they deal with correspondant banks. Almost 14,000 commercial banks maintain corresponent relationship with FE dealers.
Banks make their money by the spread between the bid and asked price which, as I said, for all major currencies average about three basis points or three cents for every one hundred dollars.
I stand corrected, (what happens when I stay up too late) the free take is only more than a lot of countries GDP. I notice you ignore the aspect of my post dissing your dissing of $USD reserve status- even the term itself. Why is that? You are free to live in the illusion you are trading Piso for Frank, Baht for Rupiah, but you wouldn't be doing it without somebody in the transaction holding $USD. The actual trade happens through the dollar- not just within trade margins on the benchmark float price as a direct exchange. Same with most commodities. Which is a bonanza for those controlling the supply of Dollars.
SeaGypsy wrote:People keep saying that about Euro and Yuan, but it's not at all realistic
SeaGypsy wrote:How 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 wrote:SeaGypsy wrote:People keep saying that about Euro and Yuan, but it's not at all realistic
But as "petro"-currencies they may work, actually.
Keith_McClary wrote:SeaGypsy wrote:How 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.
Wackypedia doesn't think he is a Canadian billionaire:
http://en.wikipedia.org/wiki/List_of_Ca ... _net_worth
SeaGypsy wrote: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.
americandream wrote:Most unlikely. The necessary trust is not there.
Yes, I agree, we should not misunderestimate themSeaGypsy wrote:Put very simply Radon; there is too much to lose for too many of the most powerful and richest.
Fine. I guess what I am saying is - if, hypothetically, the US unexpectedly disappears from the map, the EU/China would be able to ensure the scale of the international trade necessary to maintain the existing modernity order on the entire planet or some of its parts.americandream wrote: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).
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
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