CNBC Stock Blog

RSS FEED

» Help

Subscribe to this RSS feed
Stay up to date with the CNBC Stock Blog.

BRIC Will Back Dollar as Reserve Currency: Strategist

Published: Tuesday, 16 Jun 2009 | 5:07 PM ET

Text Size

By: JeeYeon Park
CNBC News Associate

The U.S. dollar has no concerns right now, said Ron Shah of Jina Ventures. The main concern for the U.S. needs to be bilateral trade agreements between the BRIC (Brazil, Russia, India, China) countries.

“The Russians are playing a little bit of a good-cop, bad-cop routine,” Shah told CNBC.

“China’s got way too much of [the dollar] in debt, Brazil and Russia have over $100 billion in U.S. Treasurys, and India needs the U.S. for strategic reasons.”

Treasury Bonds Yields & Prices

Shah said companies have to start getting worried about wealth creation — how they are creating wealth overseas and how they are going to approach the issues of GDP growth.

Second Opinion:

Dollar Outlook: 'Down, Down, Down'

“I think that’s the key issue of how this economy can recover, how the taxpayer dollar can recover, and as a nation, how we can repay our debts,” he said.

He said the Obama administration has to have a plan to repay debt and that it is important to bring the ratio down.

“It’s going to be up to Obama,” he said. “I think the incentive structure has to be focused on growth and how to create revenue despite GDP declines in the U.S.”