Americans at the crossroads of history to lead by example
American presidential elections are not only about money, power and prestige within the world’s most vibrant democracy, but also a guiding light to the believers of democratic principles and human rights followers. In 2008, the world is watching the presidential campaign in the melting pot of civilisations and beaconing land of opportunities for the last centuries, and there is one man, Barack Obama, who has caught the attention like never before in the recent past.
Watching former presidential candidate Bill Richardson endorse his fellow Democratic frontrunner Obama brought out many points why Obama has generated so much interest in the Old Continent and other parts of the world.
Richardson, the governor of New Mexico, symbolises the Hispanic vox populi and was being wooed openly by dynastic presidential runner Hillary Clinton and her husband, the former president, Bill Clinton.
Putting on back burner his personal bonds with his friends the Clintons, and an official relationship with former president Clinton under whom he served as UN ambassador and energy secretary, Richardson was candid in his appeal to the voters while endorsing Obama.
With a flavour of spiritualism sprinkled over pragmatic choice of words, Richardson spoke with his heart and soul about Obama. “There’s something special about this guy… I’ve been trying to figure it out, but it’s very good.” “Your candidacy is a oncein- a-lifetime opportunity for our nation and you are a once in a lifetime leader,” he told Obama.
The much-acclaimed Obama speech on the need for unity in the diversified spectrum of Americans got special mention from Richardson, who himself is of Hispanic origin, in his decision to endorse Obama, who is the son of a “father from Kenya” and “mother from Kansas.”
“I’ve been troubled by the demonisation of immigrants, specifically Hispanics, by too many in this country,” Richardson said. Obama’s “words are one of a courageous, thoughtful leader who understands that a house divided against itself cannot stand.”
“Senator Barack Obama addressed the issue of race with the eloquence and sincerity and decency and optimism we have come to expect of him. “He did not seek to evade tough issues or to soothe us with comforting half-truths. Rather, he inspired us by reminding us of the awesome potential residing in our own responsibility,” he said.
He added: “Senator Obama could have given a safer speech. He is, after all, well ahead in the delegate count for our party’s nomination.” Obama earlier had called for the country to rise above its racial divisions in a speech prompted by the controversy over his former pastor and spiritual advisor Reverend Jeremiah Wright Jr’s incendiary comments about race in sermons.
Obama said, “But the truth is, that isn’t all that I know of the man. The man I met more than 20 years ago is a man who helped introduce me to my Christian faith, a man who spoke to me about our obligations to love one another; to care for the sick and lift up the poor.”
Striking a chord with his supporters, Obama explained in detail, “I have already condemned, in unequivocal terms, the statements of Reverend Wright that have caused such controversy … absolutely – just as I’m sure many of you have heard remarks from your pastors, priests, or rabbis with which you strongly disagreed. But the remarks that have caused this recent firestorm weren’t simply controversial. They weren’t simply a religious leader’s effort to speak out against perceived injustice. Instead, they expressed a profoundly distorted view of this country.”
Not only condemning the remarks, but also asking Americans to get together, Obama added, “As such, Reverend Wright’s comments were not only wrong but divisive, divisive at a time when we need unity; racially-charged at a time when we need to come together to solve a set of monumental problems – two wars, a terrorist threat, a falling economy, a chronic health care crisis and potentially devastating climate change; problems that are neither black or white or Latino or Asian, but rather problems that confront us all.”
Going down memory lane to highlight the struggle for freedom and equality in the American history, Obama said, “And yet words on a parchment would not be enough to deliver slaves from bondage, or provide men and women of every colour and creed their full rights and obligations as citizens of the United States.” “What would be needed... to narrow that gap between the promise of our ideals and the reality of their time,” Obama said.
The voters in the United States of America this year are facing this choice of our time to deliver with their ballot a change in the ongoing dynastic repetition in the US presidential race.
Anyone eligible to vote 32 years ago (or nearly 56 years of age today) in 1976 would have had the fortune to see a presidential ballot without a Bush or a Clinton name on it as, after that, no single ballot paper has escaped a Bush or a Clinton. That says a lot about the dynastic rulers in the democracy of US.
On the other hand, Richardson hinted at an honourable and unselfish move to drop out of the race for Clinton saying, “I’m not going to advise any other candidate when to get in and out of the race.”
Mincing no words to make it clearer, the governor added, “Senator Clinton has a right to stay in the race, but eventually we don’t want to go into the Democratic convention bloodied. This was another reason for my getting in and endorsing, the need to perhaps send a message that we need unity.”
“It is time ... for Democrats to stop fighting amongst ourselves and to prepare for the tough fight we will face against John McCain in the fall,” Richardson said at a rally with Obama in Portland, Oregon.
Last but not least, Richardson reflected on a minor detail from their sitting together during a presidential debate. “I had just been asked a question - I don’t remember which one - and Obama was sitting right next to me. Then the moderator went across the room, I think to Chris Dodd, so I thought I was home free for a while. I wasn’t going to listen to the next question. I was about to say something to Obama when the moderator turned to me and said, ‘So, Gov. Richardson, what do you think of that?’ But I wasn’t paying any attention! I was about to say, ‘Could you repeat the question? I wasn’t listening.’ But I wasn’t about to say I wasn’t listening. I looked at Obama. I was just horrified. And Obama whispered, ‘Katrina. Katrina.’ The question was on Katrina! So I said, ‘On Katrina, my policy . . .’ Obama could have just thrown me under the bus. So I said, ‘Obama that was good of you to do that.’”
Showing posts with label American. Show all posts
Showing posts with label American. Show all posts
Monday, March 24, 2008
Tuesday, March 18, 2008
Whitewash Summit
Lots of talk, little action, climate change back
The European Summit of 27 leaders of member states last week, under Slovenia’s rotating presidency, hardly raised any expectations, nor any eyebrows, as leaders came, attended and left. The subject of Climate Change, to which Spring Council 2007 was entirely devoted, was once again on top of the agenda for 2008, with leaders trying to balance industrial lobby demands with greenhouse gas emission cuts.
European Commission President Jose Manuel Barroso, who, according to the EU grapevine is lobbying for a second term, was all smiles as he stressed his words to please both the industrial sector and European citizens.
Barroso spoke “in favour of keeping jobs and industry in Europe,” and promised to not only provide an EU-wide breathing space for industries but also get “an international agreement” on carbon dioxide (CO2) emissions.
But an argument to use environmental concessions to keep EU-wide industries on the Continent seemed less convincing as environmental pundits and industry gurus confided on the sidelines of the Spring EU Summit.
Claudia Delpero of WWF told New Europe, “A global agreement will help make industries happier, because rules will be applied to everyone. But a strong global agreement will not be possible without strong European legislation.”
Explaining the underlying reasons for industries to shift locations, Delpero said, “The real question is: would weak environmental laws really keep businesses in Europe? History has shown that major factors for relocation are proximity to markets and labour costs, while environmental laws play only a small role in the relocation factor.
“European businesses should rather take this opportunity to become global leaders in clean technologies. The American car industry provides a very good example: after refusing the idea of fuel standards, the market is now overtaken by cleaner product from Asia. Europe should learn from history and avoid mistakes already seen in the past.”
German Chancellor Angela Merkel echoed the doubts about an international agreement saying, “If there is no international deal, we should already have a (law) ready on how to deal with energy-intensive industries, rather than only starting to think about it if nobody else joins us.”
The European Commission on January 23 had proposed an auction system for CO2 for industries, who immediately protested, arguing this would make it impossible for them to compete with firms in countries with less stringent environmental rules.
The Commission responded by promising to study the problem with an eye to proposing solutions by 2011 in the belief that to do so earlier would damage the EU’s position in global talks on climate change, which are set to culminate in Copenhagen in December 2009.
But at the Summit the conclusions insisted that the issue be “analysed and addressed urgently in the new (law), so that if international negotiations fail, appropriate measures can be taken.”
Moreover, the 27 leaders also diluted ambitious proposals from Nicolas Sarkozy on the creation of a so-called “Union for the Mediterranean” to promote cooperation in the area.
The first public salvo was fired by the European Parliament President Hans-Gert Poettering, insisting on a parliamentary dimension of the Union for the Mediterranean. Calling for an explicit reference to the Barcelona Process (launched in 1995 for Mediterranean region) said, “I am convinced that the European Commission will fully take into account the parliamentary dimension of the Union for the Mediterranean in its proposal and that the European Parliament will be fully involved in the debate which will lead to the final decisions on this project.”
According to sources familiar with closed-door talks, there were reservations from member states from Central and Eastern Europe that a Union for the Mediterranean would divert precious EU funds away from the region.
Turkey also immediately was in the news as Ankara got the notion that by being invited to join Union for the Mediterranean, its EU membership application will be left on the back burner forever.
Answering a question from a Turkish journalist, Slovenian Premier Janez Jansa said, “Turkey was not mentioned at the talks.” Saving the situation, he said, “The project for a Union for the Mediterranean was presented as an upgrade of the Barcelona process.” “And sometimes, changes get a new name,” he concluded.
The European Summit of 27 leaders of member states last week, under Slovenia’s rotating presidency, hardly raised any expectations, nor any eyebrows, as leaders came, attended and left. The subject of Climate Change, to which Spring Council 2007 was entirely devoted, was once again on top of the agenda for 2008, with leaders trying to balance industrial lobby demands with greenhouse gas emission cuts.
European Commission President Jose Manuel Barroso, who, according to the EU grapevine is lobbying for a second term, was all smiles as he stressed his words to please both the industrial sector and European citizens.
Barroso spoke “in favour of keeping jobs and industry in Europe,” and promised to not only provide an EU-wide breathing space for industries but also get “an international agreement” on carbon dioxide (CO2) emissions.
But an argument to use environmental concessions to keep EU-wide industries on the Continent seemed less convincing as environmental pundits and industry gurus confided on the sidelines of the Spring EU Summit.
Claudia Delpero of WWF told New Europe, “A global agreement will help make industries happier, because rules will be applied to everyone. But a strong global agreement will not be possible without strong European legislation.”
Explaining the underlying reasons for industries to shift locations, Delpero said, “The real question is: would weak environmental laws really keep businesses in Europe? History has shown that major factors for relocation are proximity to markets and labour costs, while environmental laws play only a small role in the relocation factor.
“European businesses should rather take this opportunity to become global leaders in clean technologies. The American car industry provides a very good example: after refusing the idea of fuel standards, the market is now overtaken by cleaner product from Asia. Europe should learn from history and avoid mistakes already seen in the past.”
German Chancellor Angela Merkel echoed the doubts about an international agreement saying, “If there is no international deal, we should already have a (law) ready on how to deal with energy-intensive industries, rather than only starting to think about it if nobody else joins us.”
The European Commission on January 23 had proposed an auction system for CO2 for industries, who immediately protested, arguing this would make it impossible for them to compete with firms in countries with less stringent environmental rules.
The Commission responded by promising to study the problem with an eye to proposing solutions by 2011 in the belief that to do so earlier would damage the EU’s position in global talks on climate change, which are set to culminate in Copenhagen in December 2009.
But at the Summit the conclusions insisted that the issue be “analysed and addressed urgently in the new (law), so that if international negotiations fail, appropriate measures can be taken.”
Moreover, the 27 leaders also diluted ambitious proposals from Nicolas Sarkozy on the creation of a so-called “Union for the Mediterranean” to promote cooperation in the area.
The first public salvo was fired by the European Parliament President Hans-Gert Poettering, insisting on a parliamentary dimension of the Union for the Mediterranean. Calling for an explicit reference to the Barcelona Process (launched in 1995 for Mediterranean region) said, “I am convinced that the European Commission will fully take into account the parliamentary dimension of the Union for the Mediterranean in its proposal and that the European Parliament will be fully involved in the debate which will lead to the final decisions on this project.”
According to sources familiar with closed-door talks, there were reservations from member states from Central and Eastern Europe that a Union for the Mediterranean would divert precious EU funds away from the region.
Turkey also immediately was in the news as Ankara got the notion that by being invited to join Union for the Mediterranean, its EU membership application will be left on the back burner forever.
Answering a question from a Turkish journalist, Slovenian Premier Janez Jansa said, “Turkey was not mentioned at the talks.” Saving the situation, he said, “The project for a Union for the Mediterranean was presented as an upgrade of the Barcelona process.” “And sometimes, changes get a new name,” he concluded.
Sunday, March 9, 2008
Decline of the American dollar
Fiscal policies over the years take toll on the greenback
The days when the greenback ruled with absolute supremacy and simultaneously commanded the unparalleled confidence of chiefs of international and domestic financial institutions along with the man in the street in the remotest parts of the planet are over. The American dollar is no more “The Currency” that can be relied on for value, as was evident by a recent CNN news clip showing an antique store in New York preferring Euro over the local currency.
Since World War II, when the American dollar started replacing gold as a means of transaction on the international level, the dollar has taken some hard knocks in recent years.
With the launch of the Euro nearly a decade ago, much was written in the pro-dollar media and EMU, as the Eurozone is called, and it was compared with the “EMU,” a bird that cannot fly. But then, compared to the launch and subsequent drop as the nascent currency took baby steps, the Euro has come of age and has crossed the threshold One Euro=USD 1.5 plus. And the dollar has also lost against the other leading currencies, like the Japanese Yen and British Pound.
With the way things are going, one must understand why and when the American dollar got to that place on the pedestal. Only then does it become clear what is happening now. As mentioned earlier, a walk down memory lane shows that till World War II the exchange rates of major currencies were reflected in terms of the price of gold in the respective countries, but with the manipulation of costs of other goods then, gold was a growing discomfort among trading partners across the globe, and the dollar came as a suitable solution.
World War II ended with the emergence of the United States as the dominant military and economic powerhouse, and as countries gathered to this epiccentre for military and financial support, the dollar emerged as the financial powerpoint of the financial world.
With the issuing of US government securities there was an added charm of earning interest over dollar deposits.But to the discerning eye, there was a Catch-22 situation that stayed afloat all these decades - and still is. The use and abuse of the technical term “Balance of Payments” was so rampant by the US that one shudders to look at the figures over the years. The United States consumed more than it produced, financing the payments with printed paper and all had been well till 1971 arrived.
The US devalued the “International Currency” unilaterally. Internationally-held dollar reserves overnight lost value and that was quite a hard knock for some of the poor countries of the world.Five years later, in 1976, came the Jamaican Agreement that gave the financial world a floating exchange rate system where the markets started playing a lead role.
But again, it was not a free float and, instead, government intervention in the form of buying and selling determines the final results at the end of the day.With the arrival of the Euro in the world F/X (foreign exchange) market scene, things started changing.
And let us not forget that the Euro has replaced 15 European currencies, and some of them, like the German mark, French franc and Italian lira were backed by strong economic and industrial giants of the world.
With the Euro surging not only in value but also as a dependable currency, the world commodity markets, especially relating to oil, will start contemplating a switch to the Euro to protect themselves against instability or the falling dollar.
The US administration will definitely want to sabotage such a move by hook or crook as its financial survival depends on the role of dollar as a legitimate international currency. Now, a look at what is really going on behind the scene.
US statistic reports have repeatedly shown the American C/A (current account) deficit has expanded continuously with billions in fiscal deficit.With China shifting some of its foreign reserves into Euro, there is already a warning ringing for the United States as more countries shift to Euro; more falls in the dollar will result.
Add to those factors the role played by the locomotive economies of Asia including China and India growing by leaps and bounds in the current years. But the financial mechanism needed to keep the dollar at a price that will sustain the US C/A deficit without putting pressure on its import/export ratio, which in turn enhances or erodes the lifestyle of its citizens, will not garner support internationally over a long-term period and US will have to pay the price at some point.
The days when the greenback ruled with absolute supremacy and simultaneously commanded the unparalleled confidence of chiefs of international and domestic financial institutions along with the man in the street in the remotest parts of the planet are over. The American dollar is no more “The Currency” that can be relied on for value, as was evident by a recent CNN news clip showing an antique store in New York preferring Euro over the local currency.
Since World War II, when the American dollar started replacing gold as a means of transaction on the international level, the dollar has taken some hard knocks in recent years.
With the launch of the Euro nearly a decade ago, much was written in the pro-dollar media and EMU, as the Eurozone is called, and it was compared with the “EMU,” a bird that cannot fly. But then, compared to the launch and subsequent drop as the nascent currency took baby steps, the Euro has come of age and has crossed the threshold One Euro=USD 1.5 plus. And the dollar has also lost against the other leading currencies, like the Japanese Yen and British Pound.
With the way things are going, one must understand why and when the American dollar got to that place on the pedestal. Only then does it become clear what is happening now. As mentioned earlier, a walk down memory lane shows that till World War II the exchange rates of major currencies were reflected in terms of the price of gold in the respective countries, but with the manipulation of costs of other goods then, gold was a growing discomfort among trading partners across the globe, and the dollar came as a suitable solution.
World War II ended with the emergence of the United States as the dominant military and economic powerhouse, and as countries gathered to this epiccentre for military and financial support, the dollar emerged as the financial powerpoint of the financial world.
With the issuing of US government securities there was an added charm of earning interest over dollar deposits.But to the discerning eye, there was a Catch-22 situation that stayed afloat all these decades - and still is. The use and abuse of the technical term “Balance of Payments” was so rampant by the US that one shudders to look at the figures over the years. The United States consumed more than it produced, financing the payments with printed paper and all had been well till 1971 arrived.
The US devalued the “International Currency” unilaterally. Internationally-held dollar reserves overnight lost value and that was quite a hard knock for some of the poor countries of the world.Five years later, in 1976, came the Jamaican Agreement that gave the financial world a floating exchange rate system where the markets started playing a lead role.
But again, it was not a free float and, instead, government intervention in the form of buying and selling determines the final results at the end of the day.With the arrival of the Euro in the world F/X (foreign exchange) market scene, things started changing.
And let us not forget that the Euro has replaced 15 European currencies, and some of them, like the German mark, French franc and Italian lira were backed by strong economic and industrial giants of the world.
With the Euro surging not only in value but also as a dependable currency, the world commodity markets, especially relating to oil, will start contemplating a switch to the Euro to protect themselves against instability or the falling dollar.
The US administration will definitely want to sabotage such a move by hook or crook as its financial survival depends on the role of dollar as a legitimate international currency. Now, a look at what is really going on behind the scene.
US statistic reports have repeatedly shown the American C/A (current account) deficit has expanded continuously with billions in fiscal deficit.With China shifting some of its foreign reserves into Euro, there is already a warning ringing for the United States as more countries shift to Euro; more falls in the dollar will result.
Add to those factors the role played by the locomotive economies of Asia including China and India growing by leaps and bounds in the current years. But the financial mechanism needed to keep the dollar at a price that will sustain the US C/A deficit without putting pressure on its import/export ratio, which in turn enhances or erodes the lifestyle of its citizens, will not garner support internationally over a long-term period and US will have to pay the price at some point.
Sunday, November 25, 2007
Euro rally worries EU
ECB to take action; Merkel, Barroso express concern
Money is talk of the town and money, “The social lubricant” with a near free-fall of the US dollar, is sending ripples across the globe affecting all quarters of life. The steady fall of the American dollar against other global currencies and the meteoric rise of the nascent European currency, the Euro, is making financial pundits act and react.
Acknowledging the reemergence of tension in money markets, the European Central Bank (ECB) announced, “To counter the re-emerging risk of volatility, the ECB intends to reinforce in the upcoming main refinancing operation, as well as in the following ones for as long as it is needed and at least until after the end of the year, its policy of allocating more liquidity than the benchmark amount in main refinancing operations.” The benchmark amount is an estimate of the liquidity needed by banks to fulfil their minimum reserve requirements.
“In line with its communication of October 8th, the ECB will continue to closely monitor liquidity conditions, consistently with its aim to limit the volatility of very short term rates around the main refinancing operations minimum bid rate,” the bank in a move aimed at financial markets said.
Reiterating faith in the earlier ECB actions as “effective and flexible,” ECB president Jean- Claude Trichet said, “Looking ahead, and in line with its previous communications and actions, the ECB will continue to steer very short term interbank rates close (to) the minimum bid rate.”
Commenting on the strength of the Euro becoming a problem for some European exporters, German Chancellor Angela Merkel told N24 television on November 22 that the strong Euro and high oil prices pose a risk to the country’s economy — Europe’s largest. “We are pleased that Europe has a strong currency, but this obviously also creates problems for exports,” she said adding, “We are working on an international level to balance currency imbalances reasonably.”
European Commission President Jose Manuel Barroso echoed her sentiments last week. Speaking on the side lines of an EU-ASEAN Summit in Singapore, Barroso said, “It’s true that the very strong Euro is becoming a concern to some export sectors in some parts of the European economy.”
The European Commission this month cut its forecast for 2008 Eurozone economic growth to 2.2 percent from 2.5 percent.
In related fallout in the industry, Airbus CEO Thomas Enders said the Euro has now “crossed the pain threshold” and that the rate of the dollar’s fall “hardly leaves room for reasonable adapting.” “That is lifethreatening,” he was quoted by Der Spiegel magazine as telling the company worker’s council in Hamburg on November 22.
Although the company is expecting a record number of orders, it still must reckon with “tremendous losses,” he said. But the German economics ministry reacted the next day saying it is up to the aircraft maker Airbus and not the government to estimate the impact of the strong Euro on the company’s performance. “Only the company itself can assess how threatening such a development is for the company,” said an economics ministry spokeswoman. “Only the company can say to which degree the Euro has contributed to its development.”
Moreover, there is a flip side of the strong Euro as was pointed out by Merkel’s deputy economics minister. The rising Euro is damping the effect of rising oil prices, noted Bernd Pfaffenbach, who is also Merkel’s advisor on the Group of Eight industrial nations’ issues.
Recalling the worries during the birth of the European currency that Euro will even stay weaker than the Deutsche Mark, Pfaffenback welcome the news that China has announced plans to shift its currency reserves into Euro adding, “This shows a growth in faith in the European currency.”
Although burdened with strikes and transport chaos at home and silent directly on the rising Euro, French President Nicolas Sarkozy was about to address the currency issue during talks with Chinese leaders in Beijing.
According to media reports, a senior French official was cited as saying that Sarkozy will make proposals for an “equitable and fair” relationship among four major currencies - the US dollar, Euro, Japanese Yen and Chinese Yuan.
The common currency for the 13-nation Eurozone is hovering close to the USD 1.50 mark against the American dollar, breaking all records.
Money is talk of the town and money, “The social lubricant” with a near free-fall of the US dollar, is sending ripples across the globe affecting all quarters of life. The steady fall of the American dollar against other global currencies and the meteoric rise of the nascent European currency, the Euro, is making financial pundits act and react.
Acknowledging the reemergence of tension in money markets, the European Central Bank (ECB) announced, “To counter the re-emerging risk of volatility, the ECB intends to reinforce in the upcoming main refinancing operation, as well as in the following ones for as long as it is needed and at least until after the end of the year, its policy of allocating more liquidity than the benchmark amount in main refinancing operations.” The benchmark amount is an estimate of the liquidity needed by banks to fulfil their minimum reserve requirements.
“In line with its communication of October 8th, the ECB will continue to closely monitor liquidity conditions, consistently with its aim to limit the volatility of very short term rates around the main refinancing operations minimum bid rate,” the bank in a move aimed at financial markets said.
Reiterating faith in the earlier ECB actions as “effective and flexible,” ECB president Jean- Claude Trichet said, “Looking ahead, and in line with its previous communications and actions, the ECB will continue to steer very short term interbank rates close (to) the minimum bid rate.”
Commenting on the strength of the Euro becoming a problem for some European exporters, German Chancellor Angela Merkel told N24 television on November 22 that the strong Euro and high oil prices pose a risk to the country’s economy — Europe’s largest. “We are pleased that Europe has a strong currency, but this obviously also creates problems for exports,” she said adding, “We are working on an international level to balance currency imbalances reasonably.”
European Commission President Jose Manuel Barroso echoed her sentiments last week. Speaking on the side lines of an EU-ASEAN Summit in Singapore, Barroso said, “It’s true that the very strong Euro is becoming a concern to some export sectors in some parts of the European economy.”
The European Commission this month cut its forecast for 2008 Eurozone economic growth to 2.2 percent from 2.5 percent.
In related fallout in the industry, Airbus CEO Thomas Enders said the Euro has now “crossed the pain threshold” and that the rate of the dollar’s fall “hardly leaves room for reasonable adapting.” “That is lifethreatening,” he was quoted by Der Spiegel magazine as telling the company worker’s council in Hamburg on November 22.
Although the company is expecting a record number of orders, it still must reckon with “tremendous losses,” he said. But the German economics ministry reacted the next day saying it is up to the aircraft maker Airbus and not the government to estimate the impact of the strong Euro on the company’s performance. “Only the company itself can assess how threatening such a development is for the company,” said an economics ministry spokeswoman. “Only the company can say to which degree the Euro has contributed to its development.”
Moreover, there is a flip side of the strong Euro as was pointed out by Merkel’s deputy economics minister. The rising Euro is damping the effect of rising oil prices, noted Bernd Pfaffenbach, who is also Merkel’s advisor on the Group of Eight industrial nations’ issues.
Recalling the worries during the birth of the European currency that Euro will even stay weaker than the Deutsche Mark, Pfaffenback welcome the news that China has announced plans to shift its currency reserves into Euro adding, “This shows a growth in faith in the European currency.”
Although burdened with strikes and transport chaos at home and silent directly on the rising Euro, French President Nicolas Sarkozy was about to address the currency issue during talks with Chinese leaders in Beijing.
According to media reports, a senior French official was cited as saying that Sarkozy will make proposals for an “equitable and fair” relationship among four major currencies - the US dollar, Euro, Japanese Yen and Chinese Yuan.
The common currency for the 13-nation Eurozone is hovering close to the USD 1.50 mark against the American dollar, breaking all records.
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