China questions the dollar’s value – Part 1/2

I find Al Jazeera English, the 24-hour, Arabic-language satellite television news network, an interesting place to find an objective view of China.

The history of Al Jazeera is also interesting.

This Al Jazeera “Inside Story” from 2009 is about China questioning the value of the American dollar.

In fact, the Chinese prime minister blamed the U.S. financial system for the 2008 global recession and said a new world currency was needed to replace the dollar.

The Al Jazeera commentator questioned if China was just playing politics challenging U.S. dominance of the global financial system.

China suggested that it would be better if the dollar was replaced with the IMF’s (International Monetary Fund) Special Drawing Rights called SDRs.

The value of the SDRs would be based on a basket of currencies. China said that basing economic reserves on a group of currencies would prevent a financial crash like the 2008 economic meltdown from happening again.

Zhou Xiaochuan, the governor of the People’s Bank of China said, “The outbreak of the crises and its spillover to the entire world reflects the inherent vulnerabilities and risks in the existing system…”

There is a clip of President Obama speaking in defense of the U.S. dollar.

Al Jazeera’s “Inside Story” had a panel of guest experts from around the globe.  There was Robert Scott of the Economic Policy Institute in the U.S., Andrew Leung, an economist and a China specialist in London, and a Paris based financial analyst, Max Keiser, who writes for the Huffington Post.

Read about China’s economy

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too. 

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