From The Financial Times:
Brazil and China will work towards using their own currencies in trade transactions rather than the US dollar, according to Brazil’s central bank and aides to Luiz Inácio Lula da Silva, Brazil’s president.
The move follows recent Chinese challenges to the status of the dollar as the world’s leading international currency.
Mr Lula da Silva, who is visiting Beijing this week, and Hu Jintao, China’s president, first discussed the idea of replacing the dollar with the renminbi and the real as trade currencies when they met at the G20 summit in London last month.
An official at Brazil’s central bank stressed that talks were at an early stage. He also said that what was under discussion was not a currency swap of the kind China recently agreed with Argentina and which the US had agreed with several countries, including Brazil.
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My Comment: Should I be surprised? When a country runs a deficit of $1.8 trillion projected for fiscal 2009-2010 (and you know that is the low end of the total) .... anyone with half a brain will know that you cannot sustain yourself on international financial markets. People who borrow money are never free or independent .... the same can be said about sovereign countries. But the problem is that the U.S. does not see what the rest of the world sees .... and so the march to the cliff continues.
As a Canadian, I have the good fortune of being in a country that has not adopted the fiscal insanity that I see below. But I do know that if the U.S. goes trough rough times .... so will we. But while life may become hard for some here .... it will pale to what life will be like for many in the United States.