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Go Forward With Courage.
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Discussion Starter · #1 ·
"LONDON (MarketWatch) — The Australian and Canadian dollars, the world’s leading commodity-rich currencies, are being formally classified as official reserve assets by the International Monetary Fund, marking the onset of a multi-currency reserve system and a new era in world money."
http://www.marketwatch.com/story/aussie-canada-dollars-termed-reserve-currencies-2012-11-19

Anyone with a lick of sense knew that was coming.
I guess the Yuan is next.
The IMF has just attached the ship's anchor to our leg.
 

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Armed citizen
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"LONDON (MarketWatch) — The Australian and Canadian dollars, the world’s leading commodity-rich currencies, are being formally classified as official reserve assets by the International Monetary Fund, marking the onset of a multi-currency reserve system and a new era in world money."
http://www.marketwatch.com/story/aussie-canada-dollars-termed-reserve-currencies-2012-11-19

Anyone with a lick of sense knew that was coming.
I guess the Yuan is next.
The IMF has just attached the ship's anchor to our leg.
It is another nail in the coffin. Per the article the IMF still holds 62% "declared reserves" in US currency. With language like that it makes you wonder what an audit would reveal.

I don't see much from this move until you see the US reserves fall below 50% and oil shows the dollar the door.
 

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Given our sovereign debt, you or I would diversify too. The fact that the process is evolving slowly is a temporary benefit. I remember talking about this in B school nearly ten years ago.
 

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Go Forward With Courage.
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Discussion Starter · #5 ·
Given our sovereign debt, you or I would diversify too. The fact that the process is evolving slowly is a temporary benefit. I remember talking about this in B school nearly ten years ago.
Oil is responding and so is the USD-down plus gold and silver beginning to rally. This will affect import prices. USD -0.35
 

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Not playing games
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This seems to contradict the OP-

http://www.bloomberg.com/news/2012-11-19/treasuries-foreign-buying-doubles-china-s-sales.html

Even with all the concern about the so-called fiscal cliff, another confrontation over government borrowing limits and Chinese ownership of U.S. debt, foreign investors can’t get enough Treasuries.
Brazil, Belgium, Luxembourg, Russia, Switzerland, Taiwan and Hong Kong boosted their holdings of U.S. government securities by a collective $264.8 billion since the last debt ceiling debate ended in August 2011, Treasury data released Nov. 16 show. The purchases more than made up for the $123 billion decline in Treasuries owned by China, America’s biggest overseas creditor, to $1.156 trillion.
BTW, isn't this only expanding by two the list of officially recognized reserve assets from the present five — the dollar, euro, sterling, yen and Swiss franc...?
 

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The way our leaders are (not) budgeting and spending dollars they don't have it is not surprising the IMF is looking at other currencies to take up the slack. We are exporting inflation to the entire world with our monetary policies,,, not to mention inflation here.

I am sure Trent will come up with a graph and several links indicating inflation is around 1.5-2%.

BTW, the US is not the only country doing terrible things with their monetary policies.
 

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This seems to contradict the OP-

http://www.bloomberg.com/news/2012-11-19/treasuries-foreign-buying-doubles-china-s-sales.html



BTW, isn't this only expanding by two the list of officially recognized reserve assets from the present five — the dollar, euro, sterling, yen and Swiss franc...?
The last data I have is from September, and while foreign ownership is up from August 2011 as the story says, buying took a nosedive in September. Net US securities purchased went from around $90B in August to $3B in September. The last time it was that low was in June and July of 2011 while the circus in DC danced around before kicking the can down the road. Then August of 2011 saw an increase to ~$60B. So this could be a short term spike down while we watch the entertainment in DC, the usd competing with more currencies in the world reserve, a combination of both, or not, time will tell.
 

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Learning
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The way our leaders are (not) budgeting and spending dollars they don't have it is not surprising the IMF is looking at other currencies to take up the slack. We are exporting inflation to the entire world with our monetary policies,,, not to mention inflation here.

I am sure Trent will come up with a graph and several links indicating inflation is around 1.5-2%.

BTW, the US is not the only country doing terrible things with their monetary policies.
I just finished reading currency wars by James Rickards. I found it to be one of those defining books that opened a door within my mind when I peaked though, I thought, "Wow! That's why we are doing this." Very insightful and explains the purposeful devalution of the currency extremely well.

What they are doing, printing money, ruining the dollar, it isn't an accident. And you're right, the US is far from the only culprit in this race to the bottom as Rickards would call it.
 

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I just finished reading currency wars by James Rickards. I found it to be one of those defining books that opened a door within my mind when I peaked though, I thought, "Wow! That's why we are doing this." Very insightful and explains the purposeful devalution of the currency extremely well.

What they are doing, printing money, ruining the dollar, it isn't an accident. And you're right, the US is far from the only culprit in this race to the bottom as Rickards would call it.
I just finished this book, I think I might read it again and take notes like I was back in school.
 

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With the yield on treasuries falling as they have been, diversification is a smart strategy. Chinese purchases of treasuries are down slightly but purchases of Laotian bonds are up.
 

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I just finished this book, I think I might read it again and take notes like I was back in school.
Great book right? How many "a-ha" moments did you have? I had several where things just clicked in my mind and I understood the game a bit more.

At the end of the day, it truly is a race to the bottom. Reset currencies, start the race again.
 

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"LONDON (MarketWatch) — The Australian and Canadian dollars, the world’s leading commodity-rich currencies, are being formally classified as official reserve assets by the International Monetary Fund, marking the onset of a multi-currency reserve system and a new era in world money."
http://www.marketwatch.com/story/aussie-canada-dollars-termed-reserve-currencies-2012-11-19

Anyone with a lick of sense knew that was coming.
I guess the Yuan is next.
The IMF has just attached the ship's anchor to our leg.
Yuan is pegged to the dollar.

If the US dollar is devalued, Yuan will devalue in lock step.

My bet is that Yuan will decouple from the US dollar and will be backed by Gold with a direct exchange rate with Oil.
 

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I just finished reading currency wars by James Rickards. I found it to be one of those defining books that opened a door within my mind when I peaked though, I thought, "Wow! That's why we are doing this." Very insightful and explains the purposeful devalution of the currency extremely well.

What they are doing, printing money, ruining the dollar, it isn't an accident. And you're right, the US is far from the only culprit in this race to the bottom as Rickards would call it.
Rickards Currency war scenario: China destroys Wall Street:

Every country is devaluing and printing money because they are all linked to the US dollar.

It is a race to the bottom. The one with the worse currency gets a export advantage with their trading partner.
 
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