Beijing’s new moves bring the US Debt cataclysm nearer
America’s reserve currency status may be more threatened than people realise, but lack of faith in the Dollar is not driven by sideshows about debt ceilings. It is dictated by the growing global belief that, as a trading nation built on ingenuity, the US has lost the plot. The Slog analyses why this is.
Last June, Britain and China moved to arrange a semi-permanent currency swap between Sterling and the Yuan. It was presented as a ‘trade facilitator’ (which indeed it is) but passed largely unnoticed. The key thing about it was, like an earlier arrangement with the European Central Bank, it cut the Dollar out of a major trading exchange.
Three days ago, Beijing tied up a much bigger deal with Mario Draghi’s ECB: China and the European Central Bank have signed a currency…
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