Investor Resources
Quick Links
More Momentum Against the Dollar
- June 16, 2009
The four largest emerging nations are meeting deep in the heart of Russia this week. It’s interesting to note that the president of Iran—accused by many of his angry countrymen of rigging his re-election—made an appearance at the gathering.
It’s equally interesting to note that the United States was not invited.
What to do about the dollar is a key item on the agenda for the meeting among Brazil, Russia, India and China—collectively known as the BRIC nations.
Russia and China have both said publicly that they want to change the dollar’s role as the globe’s reserve currency. The BRICs have built up huge surpluses of dollars and Treasury securities whose value has been in steady decline for years now. The trillions of dollars in economic stimulus coming out of Washington threaten to erode the dollar’s value even more.
Russian officials say the world would be better off with a basket of currencies that includes the Chinese yuan, the Russia ruble and gold. Today a Bloomberg story says the four BRIC countries may set up a partnership to invest in each other by buying each other’s bonds and currencies.
Analysts say such a system would work on a relatively small scale and not right away, but I think that misses the bigger point. Momentum is moving against the dollar, and it’s hard to see now how it will move back. This uncertainty stands to be a positive for gold, oil and commodities.
The BRICs represent 40 percent of the world’s population, and their economies are growing at a much faster clip than the developed nations.
As the economic gap narrows relative to the U.S., Europe and Japan, the BRICs will have a greater say in making the important decisions, such as the future structure of the world’s main reserve currency. Their meeting this week makes clear these emerging giants will make sure they are heard.
09-420
Net Asset Value
as of 09/02/2010
- Global Resources Fund
PSPFX $8.72 +0.08 - Gold and Precious Metals Fund
USERX $17.25 +0.18 - World Precious Minerals Fund
UNWPX $19.21 +0.13 - China Region Fund
USCOX $8.50 No Change - Eastern European Fund
EUROX $9.05 +0.03 - Global Emerging Markets Fund
GEMFX $8.15 +0.01 - Global MegaTrends Fund
MEGAX $7.67 +0.03 - All American Equity Fund
GBTFX $19.86 +0.15 - Holmes Growth Fund
ACBGX $15.79 +0.19 - Tax Free Fund
USUTX $12.61 No Change - Near-Term Tax Free Fund
NEARX $2.27 No Change - U.S. Government Securities Savings Fund
UGSXX $1.00 No Change - U.S. Treasury Securities Cash Fund
USTXX $1.00 No Change