SHANGHAI (AFP) – China has called for ditching the US dollar as the international reserve currency, sweeping away a decades-old system to stabilise the world monetary climate and protect its massive forex reserves.
People’s Bank of China Governor Zhou Xiaochuan said he wants to replace the dollar, installed as the reserve currency after World War II, with a different standard run by the International Monetary Fund (IMF).
China, the top holder of US Treasury bonds with 739.6 billion dollars as of January, according to American figures, earlier expressed concern over its investment as the world’s largest economy battles a deep recession.
“The outbreak of the crisis and its spillover to the entire world reflected the inherent vulnerabilities and systemic risks in the existing international monetary system,” Zhou wrote in an essay posted on the bank’s website Monday.
Zhou’s comments come ahead of the G20 summit from April 2 in London, where world leaders and international organisations including the IMF are to discuss reforming the financial system.
He suggested the IMF’s Special Drawing Rights, or SDR, could serve as a super-sovereign reserve currency as it would not be easily influenced by the policies of individual countries.
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A new global currency is not the solution. Geithner and the politicians need to curtail the explosion in Washington spending, expanding the debt and destroying the dollar but the real solution is a gold backed currency free of government manipulation.
The Campaign to Cancel the Washington National Debt by 12/21/2012 through constitutional amendment begins. See http://www.facebook.com/group.php?gid=67594690498&ref=ts
We are also planning to have a booth at FreedomFest 2009, the world’s largest gathering of free minds! July 9–11 http://www.freedomfest.com in Las Vegas. Ron