Analyst: “The Dollar is No Longer as Good as Gold”

Earlier this month, an AP article painted a bleak picture of the dollar’s current and future status as the world’s reserve currency and the most powerful currency in online forex. The proliferation of stimulus efforts has left analysts worried about both the U.S.’ ability to control its ballooning deficits and the greenback’s position in relation to those debts. Both Russian and Chinese officials have intimated that it might be time to start evaluating alternatives for the world’s forex reserves in case the dollar implodes.
Peter Schiff, president of the Euro Pacific Capital brokerage, told the AP, “I think the dollar will continue to drop. Based on what we’ve done, it could lose 70% to 80% of its value over the next five to 10 years. The dollar is no longer as good as gold. It’s no longer better than any other currency.”

Others disagree, saying that the Obama administration’s efforts have helped the dollar maintain relative strength against the euro, yen, pound, and other currencies. Or, at the very least, the dollar’s proponents contend, the dollar isn’t in danger of slipping anytime soon. “I liken the dollar to an aging boxing champ in terms of being a reserve currency,” said executive director of The Economic Outlook Group Bernard Baumohl. He told the AP, “It survives because there’s no other contender out there.”