The dollar has hit a new low. Financial Times straight new report. This article is interesting because although the dollar just hit $1.25 to the Euro, it points out that serious intervention won't be considered until it hits about $1.37.
On a more interesting note, this is a Pravda Report (not directly involved in the struggle between the dollar and the Euro) that mentions monetary policy as punishment. BTW, whatever you cold war warriors may remember of Pravda, it now publishes some in depth and IMHO, accurate articles. The Pravda article follows (the translation is less than smooth).
Pravda Report on Dollar v Ruble.
We can look at the problem wider. For example, lets examine a famous Russian sociologist Alexander Zinoviev"s work "Great Evolutionary Brake", where dollar is shown as an instrument of ruling the modern world (his thoughts on this were published in Washington ProFile). Noting political, social and economical functions of dollar, Zinoviev pointed out how meaningless are the talks of euro as its real economical competitor. American currency is not gold or goods reserves, but military power of the USA. American army and navy are miles ahead those of any other country, especially of Western Europe. Euro can become stronger, but it is not principal, as there"s no such army behind it. Also, western European forces are under western 'super-society' commandment, and Americans basically rule there as well. Overall, it is possible to say that euro is a global mechanism of redistribution of dollars between world players, thinks Zinoviev.
Agreeing that integrating Europe tries to a certain degree to present euro as a dollar"s opponent, Zinoviev argues that "Europe is allowed to do this until she crosses own borders" and that "with first attempts to position euro seriously in world markets, dollar will strike severely". In his words, "it has to be remembered that even though western super society depends on successful work of many, not one mechanism, each of them is unique and can not have competitors or substitutions. Just like European society is a secondary part of western super society, lead by the US, euro is a secondary currency, a derivative from dollar - the face of global monetary mechanism. Fluctuations between these two currencies, rise of one and fall of the other are elements of the great chess game, played on thousands boards with constantly changing rules."
Dollar in most cases serves as encouragement or punishment means. Globally oriented Washington is interested in good relations with Kremlin, so its in the US" interests to keep ruble stable. "But if for some reason there will be a need to fall ruble, a week"s enough for another default or something like that. Stability of a country"s currency to dollar is exactly that encouragement factor", warns Zinoviev. Instability comes in when there"s a need to change a "bad" government.
I note, but do not assert as cause and effect, that Iraq had started denominating its oil transfers in Euros. That certainly isn't the reason we went to war, but then, complicated entities seldom make a major move for only one reason.
EDITED: The word "dollars" was changed to "Euros" in the preceeding paragraph.
On a more interesting note, this is a Pravda Report (not directly involved in the struggle between the dollar and the Euro) that mentions monetary policy as punishment. BTW, whatever you cold war warriors may remember of Pravda, it now publishes some in depth and IMHO, accurate articles. The Pravda article follows (the translation is less than smooth).
Pravda Report on Dollar v Ruble.
We can look at the problem wider. For example, lets examine a famous Russian sociologist Alexander Zinoviev"s work "Great Evolutionary Brake", where dollar is shown as an instrument of ruling the modern world (his thoughts on this were published in Washington ProFile). Noting political, social and economical functions of dollar, Zinoviev pointed out how meaningless are the talks of euro as its real economical competitor. American currency is not gold or goods reserves, but military power of the USA. American army and navy are miles ahead those of any other country, especially of Western Europe. Euro can become stronger, but it is not principal, as there"s no such army behind it. Also, western European forces are under western 'super-society' commandment, and Americans basically rule there as well. Overall, it is possible to say that euro is a global mechanism of redistribution of dollars between world players, thinks Zinoviev.
Agreeing that integrating Europe tries to a certain degree to present euro as a dollar"s opponent, Zinoviev argues that "Europe is allowed to do this until she crosses own borders" and that "with first attempts to position euro seriously in world markets, dollar will strike severely". In his words, "it has to be remembered that even though western super society depends on successful work of many, not one mechanism, each of them is unique and can not have competitors or substitutions. Just like European society is a secondary part of western super society, lead by the US, euro is a secondary currency, a derivative from dollar - the face of global monetary mechanism. Fluctuations between these two currencies, rise of one and fall of the other are elements of the great chess game, played on thousands boards with constantly changing rules."
Dollar in most cases serves as encouragement or punishment means. Globally oriented Washington is interested in good relations with Kremlin, so its in the US" interests to keep ruble stable. "But if for some reason there will be a need to fall ruble, a week"s enough for another default or something like that. Stability of a country"s currency to dollar is exactly that encouragement factor", warns Zinoviev. Instability comes in when there"s a need to change a "bad" government.
I note, but do not assert as cause and effect, that Iraq had started denominating its oil transfers in Euros. That certainly isn't the reason we went to war, but then, complicated entities seldom make a major move for only one reason.
EDITED: The word "dollars" was changed to "Euros" in the preceeding paragraph.
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