Article regarding Chinas 1 Trillion $ reserves

Hi There,

Ok from a canadian perspective looking for some internatinal imput on this topic primarily from some US perspectives as well.

Not sure if anyone is from Toronto but anyhoo- sat star article on China/Beijing 1 Trillion dollar reserve and speculation of new use of this.

I know Paulson commented this week on that Beijings holdings only represented less than a single days trading in Tbills on the global bond market and was not concerned about any rumours or speculations of shirts in their plans.

The just of it is essentially that economists believe that approx 75% of the 1 trillion is believed to be in US demoninated instruments.

Thus talks of beijing investing as much as 400 Billion into a new company of their own thus creating one of the worlds richest investment funds would have HUGE impacts on the flow of billions of dollars in the global markets.

I am sure you have all heard and sorry dont want to stir any pots that china has a huge strangle hold on the US ecomony simply based on the volume of currency that they hold as noted above.

Imputs, impacts comments on this-

Source
Toronto Star, Joe Mcdonald- Sat march 10th

The Condition Of The Dollar
By Lindsey Williams
3-4-7

There is so much to touch on regarding the dollar this month, I hardly know where to start. Regardless of where I begin, the news is not good and affects all of us. First on our list is China. They have now announced that they are refusing to accept American Corporations purchasing into their stock market any longer as they did in the past. China also said that they are no longer going to be purchasing our securities as they have in the past, including bonds and T-bills. China's decisions and subsequent announcements at the beginning of the week has sent a panic across the World's markets. Additionally, OPEC met recently and they have also stated they will be diversifying into other currencies instead of just the American dollar. They will now begin accepting other currencies and limit the trade of oil via the American dollar. March 21st 2007 will be one of the most significant dates this month. Iran has outlawed the American dollar and will put anyone in jail that uses it in their country after that date. They have the ominous notoriety of being the first nation in the world to do such a thing. The real issue in Iran is NOT nuclear, but rather the decision to not use the American dollar for trade and the sale of oil. On the heels of Iran's decision, North Korea has followed suit and also outlawed the use of the American dollar in their country. Finally, Malaysia the next day did the same thing. Central banks around the world are increasingly diversifying their reserves, including cutting holdings of American dollars, according to a survey sponsored by Royal Bank of Scotland Group PLC, the U.K.'s second-largest bank. Italy, Russia, Sweden and Switzerland have made "major adjustments" in foreign-exchange holdings favoring the Euro and the British pound, according to the poll conducted by Central Banking Publications Ltd. between September and December. "Central banks are open to saying they've been diversifying to improve returns and reduce exposure to any single currency," said Sean Callow, senior currency strategist at Westpac Banking Corp. in Singapore. There's no doubt that when they say 'diversification' they mean selling dollars. Last week a friend of mine told me they called their bank president in Vancouver, BC and he agreed with everything I have been saying about the dollar. What amazed me the most was her comment that he told her his bank is currently making preparations for the crash of the American dollar! My dear friends, I urge you to structure yourself and get out of the liquid dollar immediately. I suggest that you get out of stock markets and into international hard assets such as real estate, gold and other assets. Structure your family by setting up proper International Business Corporations and Foundations that will preserve your finances.

Pippy thanks for the post. Btw that is a scary view

Sometime last month, I can remember UAE stating they were increasing the holdings in the Euro significantly , and agree that the rise of and BRIC and more globalization will weaken the dollar in the long run.

I think the combination of the baby boomers all having their hand in the cookie jar, our current debt, the poor housing market, illegal immigration and its effects on labor and the continued slide of the middle class little by little down the economic ladder we eventually hit a tipping point and take a nice economic face plant here somewhere over the next 3-6 years.

Their are 300 million people in the U.S , however India and China alone have over 2 billion with strong economies and new a middle class emerging, similar to what happned in the U.S back in the 50's.

Where do you think the smart money is? Prob. not in the U.S. dollar

This is not to say the dollar will completey tank, but make a strong down correction.

Who knows for sure....IMO

well that is very scary but not that far from a very possible future-
i am going to be very weary of USD crosses, however should something like that happen it would affect everything accross the board.

thanks for the imput on that

kevlot

Lindsey Williams is a preacher who went to Alaska in the 70's to help with counselling the workers on the oil fields. You can only take his words on face value, but some people have backed up his story enough to make it credible. I'm looking at April and Nov 06 moves against the US dollar as possible in the near future if and when some of these things take place. Its an early warning signal for people with investments in dollars to get out asap. IMHO.

Excuse my scepticism, but what exactly are his credentials as an expert in these matters, other than as a man of God and a seemingly non-related counselling trip to Alaska in the 70s?

You tube and google = "Hey I can check this out for myself!"
If you have usd's its worth the time. If you trade fx its worth the time. Right or wrong.