A new financial system?

11:20 AM Posted by Baris Sanli
Nowadays when making oil price forecasts, one should also consider how the dollar's value will change. Before the G20 in London, interesting discussions are going on.

For example read this from WSJ:

"China called for the creation of a new currency to eventually replace the dollar as the world's standard, proposing a sweeping overhaul of global finance that reflects developing nations' growing unhappiness with the U.S. role in the world economy."

China is not alone, Stiglitz says :"The dollar reserve system is part of the problem," Joseph Stiglitz, the Columbia University economist, said in a speech in Shanghai last week, because it meant so much of the world's cash was funneled into the U.S. "We need a global reserve system," he said in the speech. (WSJ)

Now check the currency reserves of nations:

If there are concerns about dollar's long term future (we do not expect any radical changes in the short term), oil's value in terms of other commodities may stay same but in terms of dollars oil prices may rise.

WSJ : China Takes Aim at Dollar
Chinese Central Bank : Reform the International Monetary System

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