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| http://gbtimes.com/chinas-leadership-change/features/web-tv-third-angle-insight/what-chinese-horoscope-says-about |
... While the dollar currently constitutes 62 per cent of the $6 trillion in foreign holdings by the world’s central banks, when a historical view is taken into account, Dick Bove, vice president of equity research at Rafferty Capital Markets says the dollar’s actual percentage of total money supply worldwide has gone from 90 per cent in 1952 to about 15 per cent today.
Bove, like many other analysts, believes that the rise of the Chinese currency, the yuan, is at the expense of the US dollar’s dominance as a safe haven.
"Generally speaking, it is not believed by the vast majority that the American dollar will be overthrown," says Dick Bove.
"But it will be, and this defrocking may occur in as short a period as five to 10 years," he tells CNBC.
The repercussions of the dollar’s decline as the foreign currency holding of choice would be more than a symbolic hit to America’s economic standing. With a budget deficit exceeding $1 trillion per year, if the dollar were to decline against other currencies the US would find itself in the uncomfortable position of having to pay back this debt.
Bove goes further, arguing that the deadlock in Congress over the federal budget, and the now-mandatory cuts designated by the sequestration, are eroding confidence in America’s fiscal state.
"The ratings agencies are already arguing that the government's debt may be too highly rated. Plus, the United States Congress, in both its houses, as well as the president are demonstrating a total lack of fiscal credibility," says Bove.
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http://rt.com/usa/dollar-danger-as-world-currency-977/
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