China is preparing itself for the collapse of the US Dollar

[hvactec]

[ame=http://www.youtube.com/watch?v=4R5QHBMVTVk]Keiser Report: China continues buying gold before US Dollar collapse (17Jan12) - YouTube[/ame]

 

[Mr. H.]

Geithner is concerned with China's rediculously undervalued currency.

 

[TakeAStepBack]

Price to Buy Gold "Faces Resistance at $1667", IMF Seeks BRIC Funds, New Crisis "Could Engulf Banks on Both Sides of Atlantic" - 18 January 2012

The IMF meantime is asking Brazil, China, India, Japan and Russia to help it boost its lending capacity by $1 trillion, according to one anonymous IMF official who spoke to newswire Bloomberg.

Oil-exporting nations have also reportedly been asked to contribute, as the IMF prepares for a potential deterioration in the Eurozone crisis.

"Recent developments accelerate the long-run trends of [global] economic convergence and declining US hegemony," said Bank of England Monetary Policy Committee member Adam Posen in a speech yesterday.

"Importantly, this will reduce shock-absorption and provision of public goods to the international system as a whole."

In October last year, Brazil's finance minister Guido Mantega said he was opposed to the idea of Brazil buying European government bonds, adding that any assistance should come via the IMF.

The World Bank today warned that ""the risk of a much broader freezing up of capital markets and a global crisis similar in magnitude to the Lehman crisis remains."

"In particular," says the twice-yearly Global Economic Prospects report, "the willingness of markets to finance the deficits and maturing debt of high-income countries cannot be assured. Should more countries find themselves denied such financing, a much wider financial crisis that could engulf private banks and other financial institutions on both sides of the Atlantic cannot be ruled out."

 

[CrusaderFrank]

I guess that's why Obama's been saying he needs one more term to "finish the job "

 

[TakeAStepBack]

As the worlds reserve currency, it is rather unlikely that the dollar will fail any time soon in this race to the bottom. It will drag down a large chunk of the world economy with it, should that happen.

What is more likely, is a loss in the reserve status, another credit downgrade and the slow descent out of the world spotlight as a "super power". Britain suffered a similar fate many moons ago. It's the ebb and flow of artificial wealth creation.

Obama, Bush, Clinton, Reagan, etc.....pick your poison. They all have raised national debt, ran deficits and created devaluating policies (and it doesn't stop there...it goes back a long way).