We still love the dollar
The economic meltdown opened a window for a new global currency standard, but no good candidates exist.
After predictions of certain doom, the dollar is back and enjoying a major rally, Time reports. The U.S. dollar index is just off an eight-month high.
"Like the slasher in a cheesy horror flick, the dollar keeps coming back for another go, just when you least expect it," writes Michael Schuman of The Curious Capitalist.
The dollar's resilience doesn't seem to be so much because of the dollar itself, but because the world can't find anything good enough to replace it.
Even with all the economic turmoil in the U.S., the dollar still shines when compared to other world currencies. The euro, writes Schuman, "has been exposed as a fraud."
The financial crisis in Greece has highlighted the euro's weakness, just at a time when the eight-year-old euro should have been ready to mount a serious competition to the dollar.
Experts tell Time that Europe is mired in terrible debt and deficits that all the nations there share. Worse, there isn't really a system to deal with it.
Perhaps that might leave China, but the yuan isn't considered trustworthy enough, writes Schuman. Same with India's rupee.
It was almost a year ago that China, sensing opportunity as financial problems in the U.S. grew, proposed a new currency be created to replace the dollar as the global standard.
Nothing has come out of that proposal. World banks still hold more dollars and dollar securities than any other currency, The Wall Street Journal reports.
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