The dollar once the most revered currency in the world. is just money. In recent years the have been calls and moves away from the US currency towards the Japanese Yen and the Euro of the European Union.
In the last three months major world banks have put over 60% of their cash in Yen and Euros much to the chagrin of American. Which is signaling the end of the dollars dominance according Barclay Capital. The only accounts for only 37% of money in the world central banks. That compares to nearly 2/3 nearly a decade ago.
The International Monetary Fund says te dollar accounts for 62% of the world’s cash reserves.
Who is the cause of this some say Federal Reserve Bank Reserve Chairman Benjamin Bernanke. Bernanke has been since 2007 lowering interest rates and printing money endlessly which causes the dollar to lose value but prevent the recession to fall into a depression.
Peter Schiff, President of California based of Euro Pacific Capital says Bernanke is between a rock and a hard place with the fragile US economy.
If Bernanke raises interest rates a the economy would worsen, but the dollar gains strength. However, if the Fed prints more money the dollar weakens in value and inflation is guarantee to climb.
World investors want to interest rates go up and stop printing money. The US has been borrowing money in unprecedented ways. But the dollar has 10% lost value in just the last three month alone. Theses investors want the interest rates rise up dramatically to between 7 to 9%. That would put the breaks on the recovery.
“Bernanke’s other choice is to keep rates at zero, print even more money and sell more debt, but we’ll see triple-digit inflation that could collapse the economy as we know it.
“The stimulus is what’s toxic — we’re poisoning ourselves and the global economy with it.”