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HSBC bids farewell to dollar supremacy

Posted By admin On September 24, 2009 @ 10:44 am In Money Watch | Comments Disabled

Ambrose Evans-Pritchard
London Telegraph [1]
Thursday, Sept 24th, 2009

The sun is setting on the US dollar as the ultra-loose monetary policy of the US Federal Reserve forces China and the vibrant economies of the emerging world to forge a new global currency order, according to a new report by HSBC.

“The dollar looks awfully like sterling after the First World War,” said David Bloom, the bank’s currency chief.

“The whole picture of risk-reward for emerging market currencies has changed. It is not so much that they have risen to our standards, it is that we have fallen to theirs. It used to be that sovereign risk was mainly an emerging market issue but the events of the last year have shown that this is no longer the case. Look at the UK – debt is racing up to 100pc of GDP,” he said

Crucially, China and rising Asia have reached the point where they can no longer keep holding down their currencies to boost exports because this is causing mayhem to their own economies, stoking asset bubbles. Asia’s “mercantilist mindset” of recent decades is about to be broken by the spectre of an inflation spiral.

Full story here [1]

HSBC bids farewell to dollar supremacy  270809banner [2]


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URLs in this post:

[1] London Telegraph: http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/6211858/HSBC-bids-farewell-to-dollar-supremacy.html

[2] Image: http://prisonplanet.tv/signup.html

[3] Dollar supremacy, 1945 story: Sarkozy: http://www.prisonplanet.com/dollar-supremacy-1945-story-sarkozy.html

[4] Day of reckoning looms for the U.S. dollar: http://www.prisonplanet.com/day-of-reckoning-looms-for-the-us-dollar.html

[5] The World Bids Farewell to Obama: http://www.prisonplanet.com/the-world-bids-farewell-to-obama.html

[6] The Empire Strikes Back: China Daily Warns About Currency War, Blames Dollar: http://www.prisonplanet.com/the-empire-strikes-back-china-daily-warns-about-currency-war-blames-dollar.html

[7] Major nations should back dollar as key currency: Japan: http://www.prisonplanet.com/major-nations-should-back-dollar-as-key-currency-japan.html

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