This entire thing is something that I really find rather frustrating about the Internet. It generates a lot of BS or nonsense that would be spread well and there would be people that would believe it. Another example would be of those idiots that say that George Bush caused 9/11 and that the world would end by the time the Mayan calender runs out in 2012!

First lets see the reason that Russia and China are unhappy with the US dollar. In the case of Russia, Russia is not happy that she is being affected when she does not have much of a trade relation with the US at all. Most of her raw materials and services are sold to Europe. But since the US economy collapse, the deflation that has happened caused the tremendous effect of the price of the raw materials and services in Russia making her extraordinarily badly affected by the current global crisis. E.g. America sells 35% less cars than she should, Russia is selling half what she should.

Having a global currency, should the US economy collapse there would still be a very much limited effect on Russia. Europe would still need Russian resources and Russia would not see the value of her oil drop 70% in a year.

This is similar to the case with China. Russia sells natural resources to Europe, China sells everything else to every other place on Earth. China therefore needs her currency to be “small” so that her goods are cheap. She does this by using her trade surplus to buy American debt. Now that her trade surplus is virtually eradicated, she can no longer keep her currency down, and thus her goods be deemed more expensive to Americans.

So what would a global currency do for China? For one, a global currency would not allow trade deficits or surpluses to automatically correct themselves. In other words, the Americans can keep on buying Chinese goods and China would not need to buy risky American Treasuries aka debt. That is the reason why these 2 countries are so against the dollar being the de-facto currency of the world.

Let me make this clear to anybody reading this article : The US dollar is not dying! Representative Ron Paul is wrong on this issue as he is on so many other issues. If you have traveled around the world, you would know that the American dollar is the currency that the world trust. Executives all around the world still want to be paid in the $US. For example a CEO of a Thai company would rather be paid in $US rather than Thai Baht.

The dollar has got nothing to do with the current economic crisis that is happening all around the world. It is not being impacted much at all. If the dollar is dying, there would be a lot of inflation going on, not deflation. Deflation is happening now because there is not enough demand for the goods in the country. It has got nothing to do with the dollar at all.

What this speaks to in the broader sense is the sense of how people make things up and how easily the world can follow suit with it. I really urge people to study these things from credible sources such as books and articles and not from people like Representative Ron Paul or people that demand the Gold standard back. You can bet that any topic given here is genuine and not made up by the “mainstream media” or by people that are trying to take over your world.

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