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  • One World currency???

    Now this would be ripe for abuse....
    With strong nationalist fondness for a country's money how could this ever work???
    Thoughts ???

    At G20, Kremlin to Pitch New Currency
    17 March 2009
    By Ira Iosebashvili / The Moscow Times
    The Kremlin published its priorities Monday for an upcoming meeting of the G20, calling for the creation of a supranational reserve currency to be issued by international institutions as part of a reform of the global financial system.

    The International Monetary Fund should investigate the possible creation of a new reserve currency, widening the list of reserve currencies or using its already existing Special Drawing Rights, or SDRs, as a "superreserve currency accepted by the whole of the international community," the Kremlin said in a statement issued on its web site.

    The SDR is an international reserve asset, created by the IMF in 1969 to supplement the existing official reserves of member countries.

    The Kremlin has persistently criticized the dollar's status as the dominant global reserve currency and has lowered its own dollar holdings in the last few years. Both President Dmitry Medvedev and Prime Minister Vladimir Putin have repeatedly called for the ruble to be used as a regional reserve currency, although the idea has received little support outside of Russia.

    Analysts said the new Kremlin proposal would elicit little excitement among the G20 members.

    "This is all in the realm of fantasy," said Sergei Perminov, chief strategist at Rye, Man and Gore. "There was a situation that resembled what they are talking about. It was called the gold standard, and it ended very badly.

    "Alternatives to the dollar are still hard to find," he said.

    The Kremlin's call for a common currency is not the first in recent days. Speaking at an economic conference in Astana, Kazakhstan, last week, Kazakh President Nursultan Nazarbayev proposed a global currency called the "acmetal" -- a conflation of the words "acme" and "capital."

    He also suggested that the Eurasian Economic Community, a loose group of five former Soviet republics including Kazakhstan and Russia, adopt a single noncash currency -- the yevraz -- to insulate itself from the global economic crisis.

    The suggestions received a lukewarm response from Foreign Minister Sergei Lavrov on Saturday.

    Nazarbayev's proposal did, however, garner support from at least one prominent source -- Columbia University professor Robert Mundell, who was awarded the Nobel Prize in 1999 for his role in creating the euro.

    Speaking at the same conference with Nazarbayev, he said the idea had "great promise."

    The Kremlin document also called for national banks and international financial institutions to diversify their foreign currency reserves. It said the global financial system should be restructured to prevent future crises and proposed holding an international conference after the G20 summit to adopt conventions on a new global financial structure.

    The Group of 20 industrialized and developing countries will meet in London on April 2.

  • #2
    We arlready have one. It's called the dollar.
    "Only Nixon can go to China." -- Old Vulcan proverb.

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    • #3
      you need competeing currency's, keeps things in flux.
      Whoever is unjust let him be unjust still
      Whoever is righteous let him be righteous still
      Whoever is filthy let him be filthy still
      Listen to the words long written down
      When the man comes around- Johnny Cash

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      • #4
        Seems to me the Russians don't like political implications of using the USD as a reserve currency.
        "Every man has his weakness. Mine was always just cigarettes."

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        • #5
          Just to explain briefly this Special Drawing Rights and the IMF.

          The SDR is a basket of currencies for international trade and finance. The currencies and their proportions of this basket are decided by the International Monentary Fund Executive Board every five years, supposedly based on the relative importance of the currency in international trade and finance.

          The latest 2006-2010 figures are:
          USD 0.6320 (44%) DEM 0.4100 (34%) JPY 18.4 (11%) GBP 0.0903 (11%)

          The IMF Board Chairman is always from the US. He carries the greatest voting power. The others with substantial voting powers are, in decreasing order, from Japan, Germany, France and UK.

          China and Russia are in the 24 member Board. They each has less voting power than the UK.

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          • #6
            The SDR is a basket of currencies for international trade and finance. The currencies and their proportions of this basket are decided by the International Monentary Fund Executive Board every five years, supposedly based on the relative importance of the currency in international trade and finance.
            Can the IMF just "inject" a currency at whim of the board? Or does the "help" need to be sought?

            Both President Dmitry Medvedev and Prime Minister Vladimir Putin have repeatedly called for the ruble to be used as a regional reserve currency, although the idea has received little support outside of Russia.
            What good is the Ruble out side of Russia being the history of manipulation
            Here>>http://newsx.com/column/44631
            And another>>http://www.gata.org/node/6863
            In my humble opinion it's not clear is the "Euro" is going to survive the latest economic slump in it's current form.
            So what's left that has great "strength" and fungibility other than the dollar
            Last edited by Robert W; 19 Mar 09,, 03:18.

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            • #7
              Originally posted by Ironduke View Post
              Seems to me the Russians don't like political implications of using the USD as a reserve currency.
              That's OK, physical gold still acts as a world reserve.

              Most Americans don't use it very much, but everyone else on the planet does, and as the economy has collapsed, demand for bullion has soared.

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              • #8
                There is already a world currency.....its called gold

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                • #9
                  Originally posted by timebandit View Post
                  There is already a world currency.....its called gold
                  You are decades out of date.

                  It was Richard Nixon in 1971 that eliminated the fixed price of gold, causing its demise as the international currency of trade and finance.

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                  • #10
                    Originally posted by Ironduke View Post
                    Seems to me the Russians don't like political implications of using the USD as a reserve currency.
                    and if they switch to the euro everytime they raise natural gas prices their cash reserves will decline
                    Where free unions and collective bargaining are forbidden, freedom is lost.”
                    ~Ronald Reagan

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                    • #11
                      yeah just another political move.

                      A single world or reserve world currency would be the biggest pain policy planners would ever have. Monetary policies would be decided by a handful of countries (the richest) and without considering local socio-economic conditions in the smaller and poorer countries. The IMF is notorious for pushing reforms onto unwilling countries and the manner of control policy initiation will require would definitely raise issues about national sovereignty.

                      Also, what would its exchange rates be? would china, japan (huge Dollar reserves) and not to mention the US favour such a move? Would this currency be a floating or a fixed currency? Too many planet sized headaches in my opinion.

                      Btw, more interestingly, what would it be named?

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