Image by TheAlieness GiselaGiardino²³ via Flickr
As world leaders prepare to gather this weekend to reform the global financial system, the attack on dollar domination is gaining momentum. In a new report from HSBC, currency chief David Bloom bids farewell to the glory days of the dollar, which he says “looks awfully like sterling after the First World War.” A low blow!
Bloom explains:
A (US) monetary policy of near zero rates – further juiced by quantitative easing – is completely incompatible with circumstances in most of Asia, the Middle East, Latin America, and Africa. Divorce is inevitable. The US is expected to hold rates near zero through 2010 to tackle its own crisis.
What is occurring is an epochal loss in the relative wealth and economic power of the old G10 bloc of rich countries compared to rising regions of the world. The euro, yen, sterling, Swiss franc and other mature currencies will be relegated along with the dollar in this great process of rebalancing, but the Greenback will bear the brunt.
via HSBC bids farewell to dollar supremacy – Telegraph. (h/t @robpas)
Read more about the unsettling death of the greenback in my post from 10 days ago.
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