General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsEnd Of Dollar Monopoly
The predicted future hegemony of China has become a buzzword in drawing room discussions, but it has been far from being a reality.
Even with economic and political success, one thing that has been lacking is China’s grip over the rules of the game.
The rules of the game have been made and revised by Western powers for centuries, and China’s hegemony only encompasses East Asia for now.
What made countries like Portugal, the Netherlands, Britain and the US super powers were that they created and presided over a dominant system of international finance.
The new China International Payments System (CIPS) is set to debut before the end of 2015.
It has been described as a “worldwide payments superhighway for the yuan.
” The Chinese currency (officially known as the renminbi) has the potential to become a truly international, convertible currency.
The CIPS will allow banks in various countries to exchange instructions in yuans instead of US dollars thanks to lower transaction costs.
China has overtaken the US in annual trade in goods and it only makes sense that it would introduce a global payments system to make it easier for people to trade, invest and conduct transactions using the renminbi.
For the first time, the CIPS will place yuan on equal position with other world currencies in terms of risk reduction, operating hours and maximizing liquidity.
more...
http://nation.com.pk/editorials/13-Mar-2015/end-of-dollar-monopoly
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mmonk
(52,589 posts)to dominate in the long term. I'm not privy to their strategy.
Agnosticsherbet
(11,619 posts)perhaps worse.
A lot of dollars in circulation, and as people move to a different currency, the dollar will inflate like a hot air balloon.
I will need to expand my back yard garden, perhaps plant another fruit tree if there is room.
sendero
(28,552 posts).... that the war in Iraq was not about oil itself but about Saddam's declaration that he wanted to be paid for his oil in Euros.
In fact, a lot of the actions our military and Federal Reserve have taken over the decades were related to ensuring that the dollar remains the world's reserve currency.
More and more people think that day is coming to and end and soon. There are multiple forces, mostly in the "emerging economies" countries China, Russia, Brazil, India (BRICS) working hard to end that as our Federal Reserve has abused it's power, especially in the last 7 years.
This is going to be bad news for most Americans, the cost of imported goods is going to go up, our ability to run absurd government debts is going to go down.
yeoman6987
(14,449 posts)Should be looked at as very bad news in fact.
sendero
(28,552 posts).... no, it's not.
Blue_Tires
(55,445 posts)You've been digging DEEP, haven't you?
Purveyor
(29,876 posts)covet.
Blue_Tires
(55,445 posts)geek tragedy
(68,868 posts)Can't have it both ways--if you want your currency to be a global currency, that means surrending direct control over its value vs other currencies.
Is China willing to put that tool on the shelf?
stevenleser
(32,886 posts)hurt them as much as it hurts us. Their economy has some pretty interesting challenges too, not least of which the cost of labor in China is going up rapidly. I've read that, if you factor in both productivity and wage, the hourly cost and productivity for US and China is approaching parity. US workers productivity is about twice that of China, and Chinese wages are about 1/5th that of the US and climbing rapidly. If it gets to 1/2, the effective cost of labor vs productivity will be the same.
LittleBlue
(10,362 posts)economically. The yuan will ultimately be prevail as long as China's growth isn't derailed.
