MercoPress. South Atlantic News Agency
Brazil/China closer to promote trade in national currencies; announcement at BRICS summit
Brazil hopes to sign a bilateral accord with China to promote trade in their national currencies at next week's BRICS summit of the world's five emerging powers, Trade and Industry Minister Fernando Pimentel said on Thursday. Read full article
Comments
Disclaimer & comment rulesGood idea!
Mar 22nd, 2013 - 06:02 pm - Link - Report abuse 0Very good idea indeed, the dollar will most surely feel a hangover.
Mar 22nd, 2013 - 07:00 pm - Link - Report abuse 0@2 Stevie
Mar 22nd, 2013 - 08:18 pm - Link - Report abuse 0You did not read the article then?
“He gave no details on the deal except to say it would allow “an exchange mechanism in local currency involving up to 30 billion dollars” or nearly half of total bilateral trade.”
“He indicated that a capital investment of 50 billion dollars was an amount that all members may be comfortable with.”
Why would the Chin disown the USD when they have THREE TRILLION of them in their central bank?
Don't overlook the fact that the Chin currency is presently undervalued to help their exporters recover from the melt down they experienced two years ago.
So on the face of it the joint venture will use the USD as the reference. No surprise in that as it protects both parties.
There is a lot more we need to know before any sensible person could give it even a qualified 'OK'.
Oh dear Chris, are you trying to tell me that they choose to trade in their own currency only to exchange to dollars afterwards or before? That wouldn't even make sense in your world.
Mar 22nd, 2013 - 11:55 pm - Link - Report abuse 0It's a fine first step to getting rid of the green poison from our precious continent.
“Very good idea indeed, the dollar will most surely feel a hangover.”
Mar 23rd, 2013 - 01:05 am - Link - Report abuse 0Indeed, the days of “king dollar” are numbered include by the clowns at the Federal Reserve who are shooting themself in the feet with their QE's that don't work but trashing the US dollar.
“Why would the Chin disown the USD when they have THREE TRILLION of them in their central bank?”
Shows how clueless you are outside your little bubble. They include other members of the BRIC group are quietly dumping them since 2008 and buying GOLD. Old news but here it is:
http://www.zerohedge.com/news/russia-dumps-treasurys-14-consecutive-months-china-slashes-holdings-lowest-over-year
For ALL. Please, Respect...ok! ChrisR stay in another fuso. He is sleeping for now! Come on, hasta los ingleses dormem! More respect, please!
Mar 23rd, 2013 - 01:59 am - Link - Report abuse 0@4 Stevie
Mar 23rd, 2013 - 11:25 am - Link - Report abuse 0Not only can you not glimpse the pitfalls in the article, if you even read it you cannot have read my post without the little green eye you always have for anything western.
“So on the face of it the joint venture will use the USD as the reference.”
How else are the LatAms going to defend themselves from creeping devaluation by the Chin? Oh dear Stevie.
Chris
Mar 23rd, 2013 - 11:43 am - Link - Report abuse 0We all know what this iniciative means, keep aiming for clouds. The only one to use the USD as reference is you lot. Feel free to continue with your Fiat currency. The rest of the world will put value to valuables, not your printed paper.
As for the article, read “He gave no details on the deal except to say it would allow “an exchange mechanism in local currency involving up to 30 billion dollars””. That could mean they will sell up to 30 B dollars as it could mean what you say. So, if you don't have more to contribute other than what these people let out, which you don't, feel free to understand it as you wish, the rest of us knows what the iniciative is intended for.
8 Stevie
Mar 23rd, 2013 - 05:02 pm - Link - Report abuse 0So, as well as being a ”Citizen of the planet” you are now a psychic? Or is it wishful thinking on your part.
The Chin have an open agenda, which is to become the FIAT currency after the USD. Why do you think they are setting out their stalls for LatAm and Africa?
The answer is very sinple.
Then you tell me, Chris. Why do you think they aim to trade in their own currency, if not to avoid the dollar?
Mar 23rd, 2013 - 05:06 pm - Link - Report abuse 010 Stevie
Mar 23rd, 2013 - 07:33 pm - Link - Report abuse 0The Chin are not avoiding the dollar, they are disbursing dollars around the planet to buy infrastructure or provide loans secured by the infrastructure before the USD loses its FIAT status. In other words they are buying friends and countries (have a look how AR and Brasil are flashing their knickers at them) with cheap (to them) USD.
Their currency is well behind the curve in valuation terms but we all know what happens in a revaluation don't we? All the currencies go through a shakeup and the Yuan will appreciate in value making their exports become more expensive and therefore not as attractive to the market.
Imports are cheaper of course but with the reduction in export volumes there is less need for imports so the real problem lies in the cost of the work in progress and whether they can be sold. With the inefficient Chinese production processes (they rely on headcount, not machines) thei WIP is far larger than in developed countries.
Compounding that is the fact that their labour has always been underpaid and is starting to wake up to all the profits made to date. Workers are not interested in the future and the possibility it is all going to collapse around their ears so they are going flat out for the money NOW.
So far there have been thousands of factories closed and the workers dismissed and the government are getting very touchy about the possibility of a second revolution and if you don’t believe me cast your mind back to when the mass transit system failed due to the weather about five years ago. The slaves only get time off for the Chinese New Year and always go back to their ‘home’ in the country to see their family. I think it was the Prime Minister who went to several of the affected areas and it blew over, but was not dealt with in a fundamental way.
The slaves no longer have jobs and are indeed restless. Money from abroad is the only answer to their problems and the Holy Grail of the Yuan being the FIAT currency is the answ
Chris
Mar 23rd, 2013 - 08:14 pm - Link - Report abuse 0So why do you think they aim to trade in their own currency then?
Do you even know what fiat currency is? Let me know of one currency today that is backed in gold, if you do.
@12 Stevie
Mar 23rd, 2013 - 09:26 pm - Link - Report abuse 0“So why do you think they aim to trade in their own currency then?”
My post was cut-off. It ended thus:
”Long term thinkers, the Chin. It come from the sure knowledge (by them) that they are the Middle Kingdom’ and EVERYBODY ELSE IS INFERIOR.“ The Chin believe THEY should lead the world, in every sense you care to name but especially in the supply of money. They will do anything to ensure that it happens.
”Do you even know what fiat currency is?“ Yes, it is money that is backed by decree, that is all. No gold involved, just somebody telling the rest of the users of their money what the value is. At the present time the FIAT money is the USD whether you or the Chin like it or not.
”Let me know of one currency today that is backed in gold, if you do.” I do not know of ANY main stream money that is backed by gold.
Happy now?
Chris
Mar 23rd, 2013 - 09:41 pm - Link - Report abuse 0Happy indeed.
All currencies are fiat currency, not only the dollar.
You obviously don't have a clue what you are talking about, and your silly statement that the Chinese think they should lead the world is merely a product of your fantasy. Which doesn't mean they will though.
@14 Stevie
Mar 24th, 2013 - 10:43 am - Link - Report abuse 0OK, I will 'fall' for it: you tell ME which main stream currencies are NOT FIAT.
PS Don't bother with Bitcoin, or some country that nobody deals with.
I'll do a “Think” on you.
Mar 24th, 2013 - 11:48 am - Link - Report abuse 0You say:
“At the present time the FIAT money is the USD ”
I say:
ALL currencies are Fiat money
No need to fall for anything, my good Sir
@16 Stevie
Mar 24th, 2013 - 03:31 pm - Link - Report abuse 0OK, we will play the semantics game then.
You NOW agree with me that there are no currencies which are not FIAT.
However, how many of these currencies are you prepared (or can) deal in for your own finances?
In the financial world the term FIAT money is also taken to be the one that the world trades in. It used to be Sterling until around WW1 and then it became the USD.
What will be next, the Yuan? They have already tried buying oil in Yuan but have only had the desperate, marginalised countries take it up.
Chris
Mar 24th, 2013 - 03:39 pm - Link - Report abuse 0“You NOW agree with me that there are no currencies which are not FIAT.”
and
“At the present time the FIAT money is the USD ”
Which one is it, Chris?
I am finished with playing your little game.
Mar 24th, 2013 - 06:28 pm - Link - Report abuse 0Commenting for this story is now closed.
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