Greenspan tells Middle East it should drop US Dollar pegs

Former Fed Chairman Alan Greenspan, in the Middle East at a financial conference, advised it’s time to end the US Dollar’s peg to the Gulf currencies.  Pam Woodall, Asia Economics Editor at The Economist, said that this is the beginning of the end for the US dollar as the currency of choice for foreign exchange reserves. ”  Woodall also observed:  “If Asian central banks hold today more than 80 per cent of the global foreign exchange reserves, which indicates the shift of the global economy domination towards Asia, it seems quite awkward that the UAE still maintains the peg of its currency to the US dollar.” http://www.zawya.com/Story.cfm/sidZAWYA20080226042726

Meanwhile, Shaikh Gulfnews: http://www.gulfnews.com/business/Economy/10192824.html

It seems strange that as an American Greenspan would be advising this, knowing as he does the consequences for the US Dollar when it is no longer tied to petrodollars and when it is not the preferred reserve currency.  And that’s not all – he also told the Middle Eastern investors that US  growth is at “zero” and “at stall speed.”  “He said the longer growth stays at zero, the more likely the world’s largest economy would start to contract.  Greenspan also said a boom in oil prices could ‘go on forever’. http://www.abudhabinews.net/story/331147