Wednesday, October 14, 2009

The Dollar's Decline

Dollar loses reserve status to yen & euro

From the New York Post:

Over the last three months, banks put 63 percent of their new cash into euros and yen -- not the greenbacks -- a nearly complete reversal of the dollar's onetime dominance for reserves, according to Barclays Capital. The dollar's share of new cash in the central banks was down to 37 percent -- compared with two-thirds a decade ago.

Currently, dollars account for about 62 percent of the currency reserve at central banks -- the lowest on record, said the International Monetary Fund.

Bernanke could go down in economic history as the man who killed the greenback on the operating table.

After printing up trillions of new dollars and new bonds to stimulate the US economy, the Federal Reserve chief is now boxed into a corner battling two separate monsters that could devour the economy -- ravenous inflation on one hand, and a perilous recession on the other.

"He's in a crisis worse than the meltdown ever was," said Peter Schiff, president of Euro Pacific Capital. "I fear that he could be the Fed chairman who brought down the whole thing."

I wish Peter Schiff was President. He is on my list of favorite Americans. I fear that he is correct about our prospects. My biggest fear has always been the collapse of the dollar.

"Things that can't go on forever, don't" - Herbert Stein Sphere: Related Content


Libertarian Advocate said...

Shakes: Scoot over to my site. I have a story stolen (with full attribution of course) from Larry Kudlow on the same subject. Then scroll down to see a video of Peter Schiff talking to a Russia Today interviewer. Still weirds me out that a Russian news service will pick up a story like that and our own "Free Press" avoids same in fear of violating Rahm Emanuel's "Rules for Journalists".

Shakes The Clown said...

Thanks for the tip. I will check that out.