FT.com / Asia-Pacific - China calls for new reserve currency: "China’s central bank on Monday proposed replacing the US dollar as the international reserve currency with a new global system controlled by the International Monetary Fund.
In an essay posted on the People’s Bank of China’s website, Zhou Xiaochuan, the central bank’s governor, said the goal would be to create a reserve currency “that is disconnected from individual nations and is able to remain stable in the long run, thus removing the inherent deficiencies caused by using credit-based national currencies”.
Analysts said the proposal was an indication of Beijing’s fears that actions being taken to save the domestic US economy would have a negative impact on China."
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First Russia suggested this, and now China. Why not go for the trifecta and have North Korea or Iran chime in? Actually, our semi-friendly enemies, or semi-enemy friends, aren't the only ones who think that we are adopting policies that will have a negative impact. Plenty of Americans think that, too. I do not know at this point and am hoping for the best, but when I read the outline of the proposal to create a market for buying the toxic assets, it seemed that the government takes a lot of risk if it fails, but the private investors have the upside potential and don't seem to be able to lose much. Or am I misreading something?
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