China and Russia dumping dollar in bilateral trade

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GoldInMind's picture
Status: Member (Offline)
Joined: Aug 11 2010
Posts: 4
China and Russia dumping dollar in bilateral trade

So here is the next brick taken out of the dollar's fundament: "China and Russia have decided to renounce the US dollar and resort to using their own currencies for bilateral trade, Premier Wen Jiabao and his Russian counterpart Vladimir Putin announced late on Tuesday."

I'm particularly puzzled that none of the financial or mainstream media have covered this (Bloomberg alone has over hundred researchers and editors working round the clock), and this is probably one of the top 3 events for the dollar this year. On the other hand, Chris tweeted this within a few hours of the event, which is just some amazing speed. (I didn't forget to give him kudos for that in my youtube blog.)

However, the markets virtually didn't react to this important news. In my opinion, this is just a lag caused by the lack of coverage and attention by the speculators in US and Europe. But the long term effects can be very serious. This is already a second event of this kind this year (Brasil-China trading in reals and renminbi was announced in April). If this continues, there will be fewer and fewer countries accepting the dollar and it will become increasingly expensive for the US to source commodities and products around the world. What are your thoughts on this?

sosMsos's picture
Status: Bronze Member (Offline)
Joined: Nov 18 2010
Posts: 42
Re: China and Russia dumping dollar in bilateral trade

No it wont, USA will apply a poitic of protectionism agains to many euro imports. Europe and especially Germany where i live in are dependend from our exports and the US is a great customer.

So everyone is in some ways dependent from the other one. US needs customers for their T-notes, europe needs customers for their export based industry...the problem is when every business partner applies protectionism, that will pure more fire in the global economic catastrophy  in the long run

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