Passing of the torch?

Despite the cover illustration of Paul Kennedy's book in the 1980s, Japan never quite overtook the U.S. as the center of world affairs. But there's another flag looming on the horizon, and as we self-destruct of our own fiscal recklessness, they have an opportunity Japan could never have imagined...

A number of the world’s biggest banks have launched international roadshows promoting the use of the renminbi to corporate customers instead of the dollar for trade deals with China...

HSBC, which recently moved its chief executive from London to Hong Kong, and Standard Chartered, are offering discounted transaction fees and other financial incentives to companies that choose to settle trade in the Chinese currency.

The move aligns the banks favourably with Beijing’s policy priorities and positions them to profit from what is expected to be a rapidly growing line of business in the future.The phenomenon will accelerate Beijing’s drive to transform the renminbi from a domestic currency into a global medium of exchange like the dollar and euro...

China has taken several steps in recent months to boost the international use of its currency and to establish Hong Kong, the special administrative region, as the global centre for offshore renminbi business.

The more we abuse our own currency, the more demand for its use will fall. And you remember what happens to the value of something when demand decreases, right?