Warnings of certain doom from the international intelligista, reports Reuters:
UNITED NATIONS – The United Nations warned on Wednesday of a possible crisis of confidence in, and even a “collapse” of, the U.S. dollar if its value against other currencies continued to decline.
In a mid-year review of the world economy, the UN economic division said such a development, stemming from the falling value of foreign dollar holdings, would imperil the global financial system.
The report, an update of the UN “World Economic Situation and Prospects 2011” report first issued in December, noted that the dollar exchange rate against a basket of other key currencies had reached its lowest level since the 1970s.
This trend, it said, had recently been driven in part by interest rate differentials between the United States and other major economies and growing concern about the sustainability of the U.S. public debt, half of which is held by foreigners.
“As a result, further (expected) losses of the book value of the vast foreign reserve holdings could trigger a crisis of confidence in the reserve currency, which would put the entire global financial system at risk,” it said.
The 17-page report referred at another point to the “still looming risk of a collapse of the United States dollar.”
Rob Vos, a senior UN economist involved with the report, said if emerging markets “massively start selling off dollars, then you can have this risk of a slide in the dollar.
“We’re not saying the collapse is imminent, but the factors are further building up that we could quickly come to that stage if other things are not improving quickly on other fronts — like the risk of the U.S. not being able to service its obligations,” he told Reuters.
{ 9 comments }
An earnest appel to the US to close that empty stable door, then?
When the UN starts to worry, you absolutely know the cat’s out of the bag. The bigger concern is if the UN or IMF get involved in creating some new reserve currency.
It’s good that they clarified that such a collapse isn’t imminent; had they not, they might have triggered it!
Not only is the dollar going to collapse, but also the economy of the country. Socialist politicians have accumulated unprecedented debt that cannot be repaid, a huge penalty that will burden income earners for at least the next 40 years. Alternatively, imagine living with a responsible government like Hong Kong, in a Mediterranean climate like California. Unfortunately, no such Utopia exists; but Chile offers a combination of pleasant climate and fewer government burdens than many others. If you’re ready to shed the debt your government has imposed upon you, it is a good destination to consider:
http://brophyworld.com/move-to-santiago-chile/
Failing to service the debt is not going to be an issue. Printing is only limited to the font size of the text to cram zeros on the end of a number. Default will never be an issue. Being paid back with worthless cash is the problem.
I take this warning with a grain of salt. I mean, it’s the UN. They are one of the dumbest organizations in the history of organizations.
Even after it will lose a lot of value over the next few years, the dollar will probably still be one of the better currencies out there. But that’s really not saying much. It’s like being the prettiest in a contest of ugly. Still, if you want to protect what savings you have, stock up on gold, silver, bitcoin, or whatever because even if King Dollar doesn’t collapse, it will be seriously ugly.
$US vs other currencies has been gaining in value since the beginning of May.
Anyone got an explanation?
http://stockcharts.com/h-sc/ui?s=%24usd
dollar is not going to collapse . Anyway we will get back money.
————————
johncenanss
——————
Currency Converter Dollars to Pounds
If the dollar collapses, how do we return to honest money?
http://fofoa.blogspot.com/2011/05/return-to-honest-money.html
Comments on this entry are closed.