Posts filed under “Currency”
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The U.S. dollar is still king of global currencies. The dollar made up 60.9 percent of foreign exchange reserves and was used in 42.1 percent of global payments. Some countries, though, contest how much influence the U.S. dollar really has.
The term “exorbitant privilege,” coined by former French Finance Minister and later President Valery Giscard d’Estaing, refers to the benefits the U.S. receives as a result of its currency being the chosen reserve currency of the world. The term also reflects the discomfort some nations feel toward this financial favor.
What other options does the world have? Luckily, we have a chart.
The last time I taught college-level Money and Banking, over five years ago, the textbook I was coerced into assigning (but didn’t use) still had a section on the mechanics of how the banking system in a fractional-reserve regime could expand deposits (a component of “money”) by some multiple of cash reserves provided by the central bank. The Federal Reserve…Read More
Hong Kong – The Peg is Not Likely to be Changed By Peter T. Treadway July 15, 2014 In my opinion, the Hong Kong dollar peg, which has been set since 1983 to the US dollar at 7.80:1.00, should and will remain unchanged. There are sound economic reasons for this but…Read More
The authorities are suggesting that a group of London traders, known as the “cartel” and the “mafia,” may have been illegally dipping into the $5.3-trillion-a-day currency trade.
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Source: NY Times
By Channon Hodge, Aaron Byrd and David Gillen March 11th, 2014