Around the same time as I was writing about the end of the US dollar US Treas Sec Geithner was telling us how he actually liked the idea of a global currency as purported by China’s central bank governor. Of course the news didn’t go down too well in the FX markets, with the dollar dropping like a stone before Mr Geithner realised the error of his ways and clarified his comments. He went on to say the dollar is still the best reserve currency in the world but added a caveat that this would only continue if the economy and markets got back on their feet. The pros and cons of a new reserve currency have now been much debated and as noted in my previous post it will provide great fodder for markets at the G20 meeting in London next week.
As usual we are all in for disappointment, however. There will be no great change in perspective on the dollar or any other currency as UK PM Brown hinted today. Instead G20 officials will do their best to show an act of unity whilst sniping at each other’s stimulus plans in the background. Do not expect conrete policy measures emerge either. It has been a rare occassion when such get togethers yield more than a nice photo shoot of world leader.
On a completely different note it is intriguing to see how deep the loss in wealth has become when the likes of the comedian John Cleese are renegotiating their divorce settlements. A local free Hong Kong newspaper put it as the “battered rich want divorce terms slashed”. Battered indeed.