China's Assault On The Dollar - by Gordon G. Chang
"I don't believe that there's a need for a global currency," said President Obama Tuesday night during his prime-time press conference. Well, the Chinese sure do. Zhou Xiaochuan, head of China's central bank, called for the replacement of the dollar in a text released Monday.Some economists, such as Nobel laureate Joseph Stiglitz, have called for the replacement of the dollar. And concerns about depreciation of America's money are real and not just confined to the Chinese. U.S. Treasury Secretary Timothy Geithner inadvertently highlighted this widespread concern on Wednesday when he said Washington was "actually quite open" to the Chinese proposal. (He later backtracked after the dollar collapsed as a result of his ill-considered comment.
Beijing, by floating its proposal at this moment, is beginning a new round of debate about the future of the dollar and, by extension, the role of the U.S. in the global order.
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