The Truth will prevail, But only if we Demand it from Congress!
9-11 Inside Job and Neocons Hacked 2004
by David Gutierrez
(NaturalNews) Comments by China that it intends to move away from
its reliance on the dollar triggered a sharp drop in the Dow Jones
Industrial Average and heightened worldwide fears about the U.S.
currency's stability. Chinese Central Bank Vice Director Xiu Jian
said that his country is planning to shift much of its $1.4 trillion
national currency reserve from dollars to more stable currencies,
such as the euro or Canadian dollar. After these comments, the
dollar fell to record lows relative to other currencies -- the
lowest ever against the euro, the lowest in a generation against the
British pound, and the lowest in 57 years against the Canadian
dollar.
"The big issue on any currency is if its rate of depreciation is so
fast that it scares away all capital, and the announcement that we
heard from China sort of feeds those fears," said Larry Smith, chief
investment officer at Third Wave Global Investors.
China is the world's largest investor in U.S. Treasury bonds and
securities, holding more U.S. debt than any country but Japan.
Because China's currency is linked to the dollar, the country also
maintains a massive reserve of the currency.
But this policy had already begun to shift at the time of Xiu's
comments. China has divested approximately 5 percent of its $400
billion holdings in the U.S. Treasury and established a $200 billion
fund to help diversify its investments in equities and stocks around
the world.
"We will favor stronger currencies over weaker ones, and will
readjust accordingly," said Cheng Siwei, vice chairman of China's
National People's Congress.
It is not just U.S. investors who are concerned. Because the
dollar's fluctuations have driven up the euro, exports in Europe
have fallen and sparked fears for the stability of that continent's
economy. In a recent speech, French president Nicolas Sarkozy added
his voice to those calling for the Bush administration to act to
stabilize the currency.
"The dollar cannot remain 'someone else's problem,' " Sarkozy said.
"If we are not careful, monetary disarray could morph into economic
war. We would all be its victims."
