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Currency – Global Challenges

I see that greatest challenge for the next decade to be a fundamental one – what should the world’s currencies be? Over the last century we have seen the rise of the US dollar as the primary unit of global currency which we use to measure and value much of our relative individual, organisational and national wealth and investments, and through which we exchange, trade and price commodities, businesses, goods and services. The status of the US dollar as the global reserve currency is however under enormous pressure and, with the rise of new currency blocs in the world, many have been asking whether the Euro will emerge as an alternative reserve currency. The 2008-9 financial crisis put enough pressure on the US currency to such an extent that many now see that we need an alternative, but the question is what? Will the US remain as the pre-eminent financial power or will its influence secularly decline stimulated by the recent crisis and its inability to achieve a major technological breakthrough or exercise the necessary conditions for it to remain a reserve currency? And, if we go for an alternative, why would this be the Euro? Read more

Popularity: 2% [?]

Currency – Options and Possibilities

It is certain that for the next decade the US dollar will remain as one of the reserve currencies. As such it will still be a key currency for foreign exchange and a transaction currency for international trade and investments in 2020. The US dollar will continue to be integrated into, and influential upon, the world economy. Read more

Popularity: 2% [?]

Currency – Proposed Way Forward

Over the next decade, we will move unmistakably towards a multi-polar world which will be characterized by a much broader consultative process that extends to a larger number of jurisdictions. Greater coordination amongst major economies on financial sector regulation will be needed, and this can be facilitated by the newly enlarged Financial Stability Board based in Basle. At its core, the coordination will have to be aimed at achieving greater trust in the transparent and universally applicable working of the financial system. This will especially need to dispel the fear that the global financial system has a bias in favour of any one country or group of countries or group of dominant institutions. As the G20 has superseded the G7, financial management of the global system must become more equable: Within this it is possible that a more prominent role is given to Special Drawing Rights – the international reserve assets managed by the IMF that currently amount to over $300 billion. It was used to boost global liquidity in 2009, but additional ongoing and arguably more proactive applications should be made more practical. Read more

Popularity: 2% [?]

Currency – Impacts and Implications

The successful acceptance of an ACU driven by a wide basket of national currencies will, in itself, have several significant impacts within Asia: If the ACU is positioned alongside the US dollar and the Euro as a third global reserve currency the broader implications will be far reaching. Read more

Popularity: 3% [?]