Euro

The euro cannot replace the dollar as the world’s main reserve currency, and a system of two reserve currencies would be unstable, billionaire investor George Soros said on Thursday.

What if the international currency of the future isn’t the dollar, but isn’t the euro either? James D. Grant, the editor of Grant’s Interest Rate Observer and an expert on financial markets, discusses the “historical anomaly” of currencies like the dollar and the euro as uncollateralized international reserve currencies—that is, ones that aren’t backed by a guarantee that they can be exchanged for something else, such as gold or silver.

MOSCOW — Russians increasingly favor euros over dollars when exchanging money or withdrawing foreign currency from bank accounts, the central bank said.

Opec countries meeting in Saudi Arabia clashed on Friday over the declaration to be made by leaders at this weekend’s summit, as Venezuela and Iran pushed for a statement on the impact of the weak dollar on the group’s revenues. The disagreement was revealed when a ministerial meeting Friday afternoon, supposed to be in closed session, was accidentally broadcast live to reporters.

It seems that worries over China dumping its reserves of a trillion, or so, American dollars are just the tip of a much larger iceberg. Sovereign wealth funds, opaque investment funds controlled by cash-rich governments like China, Abu Dhabi and Russia, are set to buy more emerging markets currencies, at the expense of their more established counterparts. In other words these funds, which have reserves totaling $2.3 trillion, are set to sell off more American dollars, euros and British pounds.

Governments must let go of the fatal notion that nationhood requires them to make and control the money used in their territory. National currencies and global markets simply do not mix; together they make a deadly brew of currency crises and geopolitical tension and create ready pretexts for damaging protectionism. In order to globalize safely, countries should abandon monetary nationalism and abolish unwanted currencies, the source of much of today's instability.

Arizona State University is allegedly teaching that the U.S., Mexico and Canada need to be "integrated" into a unified pro Big Business superstate, where U.S. citizens of the future will be known as "North Americanists," according to the taxpayer-funded "Building North America" program.

The program openly advocates for the "integration" of economic issues across the continent, and in many places goes further – such as the call for a common North American currency.

As a component of George W. Bush's world of "globalism," the status and health of the U.S. dollar deserves close scrutiny, closer than my mention of it in a recent column. As I've written, China is now the holder of an incredible stash of dollars. Some reports have their cache valued at over $1 trillion. You don't have to be an economics professor to worry about numbers like that. That's quite a fistful of dollars for a burgeoning superpower nation whose ultimate geopolitical goals have always been suspect. China, conceivably, could put the U.S. economy in peril if it chose to dump these dollars on the open currency market.