Can the World Really Abandon the Dollar As A Reserve Currency?

[Erdogan]

The reserve currency status of dollar is not formal at the moment. It was, at the time of Bretton Woods conference.

Reserve currency can mean the preferred currency for reserves in other national currency banks. They use the reserves to regulate the value of the national currency. National banks now try to diversify. It also means that it is the currency preferred in international trade. Due to history, this has been USD from the second world war.

In international trade, sometimes dollar is used even if both traders reside in non-dollar countries, meaning that both parties have to convert. This sounds irrational, but for instance the Venezuelan bolivar/ icelandic crown pair is thinly traded, and it is easier for each merchant to relate to the dollar.

The reason we have the system of150 national currencies anyway, is that each government wants to steal from their constituents through inflation.

Anyway, the take home point is that traders decide what is the currency used for international trade. It will not be easy for china or someone else to change the current situation. It is about convenience and trust in the continued value, and trust that the the money can be used freely.

[Erdogan]

What china have to to, to make the yuan the preferred money for trade, is to stop all currency import export restrictions, let money exchangers, small and large exist without bullying, and let a bank system disconnected from the existing usa dominated banks grow up. They will also have to show som discretion in the money printing. I can not see any of those things happen.

Trying to keep the money within a countrys border is absurd, but kings have tried to do that in thousands of years. They don't understand that money is not goods, services and capital, the things that make a country rich. Misses de Kirchner in Argentina is doing it right now (with dollars), taking the country down with her.

When money flows out of a country, the people in that country will try to replenish their cash balances by exporting more, thus correcting the situation and make everybody richer. That's why there should be no currency restrictions.

[botany]

The reserve currency status of dollar is not formal at the moment. It was, at the time of Bretton Woods conference.

Reserve currency can mean the preferred currency for reserves in other national currency banks. They use the reserves to regulate the value of the national currency. National banks now try to diversify. It also means that it is the currency preferred in international trade. Due to history, this has been USD from the second world war.

In international trade, sometimes dollar is used even if both traders reside in non-dollar countries, meaning that both parties have to convert. This sounds irrational, but for instance the Venezuelan bolivar/ icelandic crown pair is thinly traded, and it is easier for each merchant to relate to the dollar.

The reason we have the system of150 national currencies anyway, is that each government wants to steal from their constituents through inflation.

Anyway, the take home point is that traders decide what is the currency used for international trade. It will not be easy for china or someone else to change the current situation. It is about convenience and trust in the continued value, and trust that the the money can be used freely.

The Chinese Yuan will have to become freely convertible, before people start looking at it as a reserve currency. Right now, even if you have CNY, there aren't many assets that a non-Chinese can buy.

[username18333]

GE coin for the win!

[zimmah]

No, of course not

Just because all other empires have fallen. And all fiat currencies have inflated into being worth less than toilet paper, that doesn't mean it also happens with America.

Because America is just that special, it will last forever, and so will the dollar.

[51percemt]

No, of course not

Just because all other empires have fallen. And all fiat currencies have inflated into being worth less than toilet paper, that doesn't mean it also happens with America.

Because America is just that special, it will last forever, and so will the dollar.

The american empire will likely not last forever just as other empires have not lasted forever. (I somewhat think that Obama is trying to get the American empire to fall). Until the American empire falls the US dollar will likely remain to be a reserve currency as it is able to exert enough influence (both economic and political) to get other countries to accept the dollar for their reserves

[username18333]

No, of course not

Just because all other empires have fallen. And all fiat currencies have inflated into being worth less than toilet paper, that doesn't mean it also happens with America.

Because America is just that special, it will last forever, and so will the dollar.

The american empire will likely not last forever just as other empires have not lasted forever. (I somewhat think that Obama is trying to get the American empire to fall). Until the American empire falls the US dollar will likely remain to be a reserve currency as it is able to exert enough influence (both economic and political) to get other countries to accept the dollar for their reserves

Of course pres. Obama is attempting to fell his empire. How else would GE enter the public consciousness?

[DhaniBoy]

of course this is impossible to happen, because the American dollar is still the belle of the currency trading world, there are still many countries and European Americans use the dollar as a trading currency they use, although there are also some competitors such as the euro and the pound of English ... 

[username18333]

of course this is impossible to happen, because the American dollar is still the belle of the currency trading world, there are still many countries and European Americans use the dollar as a trading currency they use, although there are also some competitors such as the euro and the pound of English ...  

You forgot GE coin.

[redHeadBlunder]

of course this is impossible to happen, because the American dollar is still the belle of the currency trading world, there are still many countries and European Americans use the dollar as a trading currency they use, although there are also some competitors such as the euro and the pound of English ... 

This is true, however it will not necessarily always be like this. It is very well possible that the US economy could falter because of our massive social programs and the dollar end up like the british pound

[xmasdobo]

No, of course not

Just because all other empires have fallen. And all fiat currencies have inflated into being worth less than toilet paper, that doesn't mean it also happens with America.

Because America is just that special, it will last forever, and so will the dollar.

Well it has been ages since people started the whole "we are all doomed, usa is going to hell, the dollar is over" perpetuated by the likes of Alex Jones and what not, yet here we are, 2014, in the middle of an epic economic crisis, and things just keep going and going. Nothing ever changes.

[username18333]

No, of course not

Just because all other empires have fallen. And all fiat currencies have inflated into being worth less than toilet paper, that doesn't mean it also happens with America.

Because America is just that special, it will last forever, and so will the dollar.

Well it has been ages since people started the whole "we are all doomed, usa is going to hell, the dollar is over" perpetuated by the likes of Alex Jones and what not, yet here we are, 2014, in the middle of an epic economic crisis, and things just keep going and going. Nothing ever changes.

You forgot GE coin.

[CryptoCarmen]

It is really interesting to see how much influence Bitcoin will have on this. Altho days of USD as world reserve currency are already counted down, Bitcoin can decrease them drastically. It can all happen just in a decade.

[botany]

It is really interesting to see how much influence Bitcoin will have on this. Altho days of USD as world reserve currency are already counted down, Bitcoin can decrease them drastically. It can all happen just in a decade.

I would wait to see at least 1 country officially accept Bitcoin. That would mean a real new threat to USD.

[CryptoCarmen]

It is really interesting to see how much influence Bitcoin will have on this. Altho days of USD as world reserve currency are already counted down, Bitcoin can decrease them drastically. It can all happen just in a decade.

I would wait to see at least 1 country officially accept Bitcoin. That would mean a real new threat to USD.

What do you understand as accept BTC. To totally ditch their own currency? and just depend on BTC?  Or just not make any fuss of it and accept Bitcoin as any other foreghin currency?

I think there are many countries that already did or will soon treat Bitcoin as was my second option.

I think it will take lots of time until this happen. I think every country will still push forward their own currency as much as they can.


You see on this forum in altcoin sections. Everyone pushes their own altcoin, no matter how good it is. But all of them accept other altcoins.

[username18333]

It is really interesting to see how much influence Bitcoin will have on this. Altho days of USD as world reserve currency are already counted down, Bitcoin can decrease them drastically. It can all happen just in a decade.

I would wait to see at least 1 country officially accept Bitcoin. That would mean a real new threat to USD.

What do you understand as accept BTC. To totally ditch their own currency? and just depend on BTC?  Or just not make any fuss of it and accept Bitcoin as any other foreghin currency?

I think there are many countries that already did or will soon treat Bitcoin as was my second option.

I think it will take lots of time until this happen. I think every country will still push forward their own currency as much as they can.


You see on this forum in altcoin sections. Everyone pushes their own altcoin, no matter how good it is. But all of them accept other altcoins.

Accept them for the payment of taxes.

[pitham1]

It is really interesting to see how much influence Bitcoin will have on this. Altho days of USD as world reserve currency are already counted down, Bitcoin can decrease them drastically. It can all happen just in a decade.

I would wait to see at least 1 country officially accept Bitcoin. That would mean a real new threat to USD.

What do you understand as accept BTC. To totally ditch their own currency? and just depend on BTC?  Or just not make any fuss of it and accept Bitcoin as any other foreghin currency?

I think there are many countries that already did or will soon treat Bitcoin as was my second option.

I think it will take lots of time until this happen. I think every country will still push forward their own currency as much as they can.


You see on this forum in altcoin sections. Everyone pushes their own altcoin, no matter how good it is. But all of them accept other altcoins.

Accept them for the payment of taxes.

Or maybe add it to their foreign currency holdings.

[username18333]

It is really interesting to see how much influence Bitcoin will have on this. Altho days of USD as world reserve currency are already counted down, Bitcoin can decrease them drastically. It can all happen just in a decade.

I would wait to see at least 1 country officially accept Bitcoin. That would mean a real new threat to USD.

What do you understand as accept BTC. To totally ditch their own currency? and just depend on BTC?  Or just not make any fuss of it and accept Bitcoin as any other foreghin currency?

I think there are many countries that already did or will soon treat Bitcoin as was my second option.

I think it will take lots of time until this happen. I think every country will still push forward their own currency as much as they can.


You see on this forum in altcoin sections. Everyone pushes their own altcoin, no matter how good it is. But all of them accept other altcoins.

Accept them for the payment of taxes.

Or maybe add it to their foreign currency holdings.

You mean "their [commodity] holdings."

[zinger]

No it can't.. The world will not survive without universal currency.

[pattu1]

No it can't.. The world will not survive without universal currency.

But does USD have to be that universal currency?