Remember the LORD for it is he who gives you the ability to produce wealth and so confirms his covenant... Deut. 8:18

Thursday, March 5, 2009

Of flawed paper currencies, U.S. dollar still the best

The U.S. dollar is far from a perfect currency, but it's still better than the alternatives. According to Bloomberg, "The euro is a multinational creation, belonging to no specific country and adopted by 16 nations, several of which are economic basket cases. The yen and the pound aren’t used enough in international trade and financial transactions. China’s yuan isn’t freely traded or exchangeable.

"Industrial production in Europe and Japan are plunging. The financial crisis in the U.K. will probably be worse than what we're experiencing in the U.S. And the interest rate spreads on foreign currencies over the dollar are too thin to make the added risk attractive.

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