IS KING US DOLLAR ABOUT TO BE DETHRONED?
As I have written about many times, it appears that the days of the US dollar as the global reserve currency are numbered. In an article in the RT.com Dick Bove, vice president of equity research at Rafferty Capital Markets says the dollar’s actual percentage of total money supply worldwide has gone from 90 per cent in 1952 to about 15 per cent today. Bove says, “Generally speaking, it is not believed by the vast majority that the American dollar will be overthrown But it will be, and this defrocking may occur in as short a period as five to 10 years.”
It’s for this reason that I preach to clients about the need to invest globally. Especially for those retirement investors who need enhanced income, global markets may be the way to go.
The question that i hear often is which currency will replace the dollar as the world’s ‘go-to’ currency.
According to Realcurrecnices.com,
“China is moving towards a Gold backed yuan that will be very powerful in the international arena. Recently Australia, which is already completely dependent on China, with 30% of its exports going there, is preparing direct convertibility between the yuan and the Australian dollar, meaning they will no longer use US dollar to finance bilateral trade. This means less US dollars are needed in its reserve currency role.
In 2001 Goldman Sachs executive Jim O’Neill invented the BRIC’s. South Africa was later added, representing Africa and emphasizing its globalist agenda. Russia and China, as two powerful neighbors, obviously have long standing and important bilateral relations. But equally obviously, have little in common with Brazil, India and South Africa. India and China are actually sworn enemies. However, in 2009 they organized a first summit. Just a week ago we all of the sudden hear the BRICS are planning to open up a competitor to the IMF. They’re still working out the details and it’s not a done deal yet, but the move looks very serious.”
The information contained in this article reflects the opinion of the author and not necessarily the opinion of Portfolio Resources Group, Inc. or its affiliates.
Aaron Katsman is author of the book Retirement GPS: How to Navigate Your Way to A Secure Financial Future with Global Investing (McGraw-Hill), and is a licensed financial professional both in the United States and Israel, and helps people who open investment accounts in the United States. Securities are offered through Portfolio Resources Group, Inc. (www.prginc.net) a registered broker/dealer, Member FINRA, SIPC, MSRB, SIFMA. For more information, visit www.aaronkatsman.com or email aaron@lighthousecapital.co.il.
