Dollar bashing is a popular pastime right now. China wants a new reserve currency; the IMF thinks that its Special Drawing Rights international reserve asset would make a nice replacement; some suggest the Euro; still others promote the Chinese remnimbi. The coffers of the world's central banks are piled high with dollars, and the U.S. government is piled high with debt.

While economists disagree on the prospects or a timeline (maybe 10 years away) in a shift away from the dollar as reserve currency, it's a reality that if the dollar loses its preeminence, higher interest rates in the U.S. will discourage borrowing and hurt the domestic banking sector. But some economists say a shift away from the dollar could also make it easier for smaller and regional U.S. banks to do international business, because transaction costs would decline, leveling the playing field.

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