2. However one can be upbeat on the recovery of dollar as world currency despite its downfall in recent times as small signs of economic recovery are visible. World Bank president Robert Zoellick is not holding such optimistic views and feels that the fiscal-stimulus plans are insufficient to turn around the ‘real economy’ and rising joblessness is likely to set off political unrest across the globe.
3. He further added while stating at Bloomberg that stimulus has given an impulse; however same is like a sugar high unless one eventually get the credit system working.
4. He is speaking US tune probably world bank is also controlled by US and has stated that dollar will remain the world’s main currency for a long time as investors have flocked to the dollar as a safe heaven during the worst parts of the financial crisis. However he warned that fangs of inflation is not fatr behind as finances of many countries are deteriorating and stimulus packages has just given a booster dose to revive flagging economies for the time being.
Our assessment
As we can see that US is overburdened with debt and is crushed under the weight of its own debt and unemployment with the same being at the highesy levels during the current century; thus one has to take a pragmatic view in this regard to the fact that how the dollar can actually live up to its safe heaven status during times of economic and financial turmoil in the years to come as it is itself living on borrowed money.
