Aussie official: U.S. dollar may collapse


A top Australian treasury official is warning of a global financial tsunami if there is a U.S. dollar and government bond sell off.

Treasury Secretary Ken Henry compared the flood of money pouring into the United States to support its budget and current account deficits to the stock market's dot-com bubble in the late 1990s, the Australian reports.

If money stops pouring into the United States, it would hit the U.S. economy, cut Chinese exports and lead to the end of Australia's booming mineral exports to China.

Ramifications would also hit all other parts of the world economy.

Henry is just the latest in a string of recent voices warning about a possible dollar collapse. The International Monetary Fund said Wednesday urgent combined international action is required to head off such a danger.

Washington is running a budget deficit of $430 billion and a balance of trade deficit of $600 billion.


Big News Network.com Friday 25th February, 2005 (UPI)

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