Obama on a new world currency

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This is what you get from a president who doesn’t understand the monetary system. The strength of the dollar is off point:

Obama Defends Spending Plan, Tempers Criticism of Wall Street

by Julianna Goldman and Kim Chipman

Mar 25 (Bloomberg) — “I don’t believe that there’s a need for a global currency,” Obama, 47, said. “As far as confidence in the U.S. economy or the dollar, I would just point out that the dollar is extraordinarily strong right now.”

The main difficulty with a world currency is how the budget deficit (the only source of net savings of financial assets for that new currency) in that currency is managed. And with a world of leaders who don’t understand how currencies work, the odds of getting that anywhere near right are very long.


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5 Responses to Obama on a new world currency

  1. torjan horse says:

    Cutcheon beware – it’s a trap, Obama is protecting the little investor like you by using the greed of the megacapitalists who got us into this to crash thier ship. We are all socialists now, don’t worry, whatever benefit the moslers and gross’s of the world think they are about to get will soon be taxed away and given to you and me. I feel sorry for Sada – all those years trying to help Daddy build his empire and when he dies it will all be taxed away and she will be left a virtual pauper ;(


  2. jcmccutcheon says:

    Here are the asset manager requirements.


    Matt Franko Reply:

    A guy from PIMCO on cnbc the other morning said there were probably 6-10 firms globally that could qualify.
    Resp, Matt


  3. jcmccutcheon says:

    Warren got this from http://www.treasury.gov How can I participate?
    Is their any way an average Joe 6-pack like me can get in on this

    Sample Investment Under the Legacy Loans Program

    Step 1: If a bank has a pool of residential mortgages with $100 face value that it is seeking to divest, the bank would approach the FDIC.
    Step 2: The FDIC would determine, according to the above process, that they would be willing to leverage the pool at a 6-to-1 debt-to-equity ratio.
    Step 3: The pool would then be auctioned by the FDIC, with several private sector bidders submitting bids. The highest bid from the private sector – in this example, $84 – would be the winner and would form a Public-Private Investment Fund to purchase the pool of mortgages.
    Step 4: Of this $84 purchase price, the FDIC would provide guarantees for $72 of financing, leaving $12 of equity.
    Step 5: The Treasury would then provide 50% of the equity funding required on a side-by-side basis with the investor. In this example, Treasury would invest approximately $6, with the private investor contributing $6.
    Step 6: The private investor would then manage the servicing of the asset pool and the timing of its disposition on an ongoing basis – using asset managers approved and subject to oversight by the FDIC.


  4. Mike Norman says:

    But Geithner just came out minutes ago saying he was in favor of discussing an SDR linked currency. The dollar’s getting crushed. I’ve never seen such levels of ineptitude!


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