As the meetings of the G-20 leaders concluded this week in London, there were serious discussions on-going about the possiblity of replacing the "almighty" U.S. Dollar with another "reserve" currency worldwide.

In fact, the topics included the possibility of replacing the U.S. Dollar with the Chinese Huan (which normally "floats" in line with the U.S. Dollar anyway). China, obviously, gets much of its capital from exports to the USA. In addition, China and Japan are the two largest purchasers of our U.S. Treasury Debt. 

Other possible topics (fully endorsed by Russia and other nations) included a new "world currency" to be managed and maintained by the IMF (International Monetary Fund) as well as the World Bank. This new global currency may, in fact, be a form of "Special Drawing Rights" (SDRs - a form of a "basket" of various currencies worldwide). 

The G-20 meetings did not formalize the actual replacement of the weakening U.S. Dollar with SDRs as of this week. However, this real possibility still may happen in the near term. Sadly, this may impact the U.S. bond, real estate, and stock markets tremendously should this occur as many foreign investors will then dump their holdings in U.S. Dollars. 

This, in turn, will cause the U.S. Dollar to comedown even more in value. This may then lead to hyperinflation, and asset deflation (an economic occurence which has never happened simultaneously in the U.S.A.'s entire history.