| Author |
 Replies: 21 / Views: 2,755 |
|
Pillar of the Community
United States
3098 Posts |
I know this isn't really coin specific, but this matters to me, since I have way too much FOREX.
Anyways, the USDX, the index basket of the US dollar comparing it to the EUR, CHF, SEK, JPY and another one has fallen below 80. This is undoubtedly good for our members in other countries, especially in Australia, where rates have gone from .62 to .78 in 1 month?
Any ideas, guys? Maybe when it will stop?
Looking at the charts, I think it's going to repeat the downfall during the 2002 period.
Also, is it a good idea to have an investment forum or market forum to hold market specific discussions?
|
|
|
|
Pillar of the Community
United States
2541 Posts |
I agree, many such as GBP, and EUR have rallied recently.
|
|
Bedrock of the Community
United States
10982 Posts |
Relatively speaking; most countries' currencies look weak right now. The USD is taking a bit of a hit this week but nothing compared to what we'll see in 2010-2011 when inflation starts kicking in with a vengeance. We've poured more $$ in to our system than other nation's have so it stands to reason that our dollar will devalue.
Got GOLD?
|
|
Pillar of the Community
 United States
3098 Posts |
Quote:
2010-2011 when inflation starts kicking in with a vengeance. Quantitative easing: both the Fed and Congress is participating in it. Plus, SP500 might degrade US and British bonds from AAA to something... Quote:
Got GOLD?
More like are you stockpiling?  |
|
Pillar of the Community
Australia
1040 Posts |
Great news isn't it  At least from this side of the world.  Time to check out ebay USA again. |
|
Pillar of the Community
United Kingdom
1077 Posts |
Here, here, it's certainly good for me!
About to come for a visit to the US, plus monthly maintenance payments. I was enjoying the $2 to £1 not so long ago.
When it dropped to $1.30 in a short space of time, well ouch!
|
|
Valued Member
United States
207 Posts |
Well if hyper-inflation does kick in high gear to the end of this year beginning of next year, which I know it will, it spells doom for the worlds economy once more. The US is the worlds larger consumer country and if prices go up high all we will be spending our money on is food..lol because $20-80 USD for a loaf of bread is the only thing I could afford. Forget the HDTV/DVD/BLURAY/ETC from China..lol. If that happens you will see the US gov go to some type of backing of the US currency. They will have to do it. What is the Fed rate right now 0.0 or .05 %..lol cant go any lower than that and if they increase it then its another punch to the economy. Who knows maybe we might see a bit of silver and gold back in the currency. It will be very small fractional amounts but it might just happen. The fiat currency was always doomed from the start in my opinion. All what is happening now (IMHO) started back in 71 with Nixon killing the last of the gold standard by removing the Bretton Wood System.
Edited by markapsolon
05/25/2009 5:54 pm
|
|
Pillar of the Community
United States
3098 Posts |
Well Mark, I really don't like the fear-mongering *MASSIVE HYPERINFLATION, DOLLAR WORTHLESS  * because it's not going to happen... well, I sure hope it doesn't go down Weimar style! The first reason why the dollar is still so strong is mainly, from recent times, a 1970s OPEC protocol that states anywhere in the world, if a barrel of oil is to be bought or sold, it must be done in US dollars. Now, countries could choose not to follow this, but they would be at a loss since light sweet crude (and gold and silver) are denominated in US dollars. Thus after this landmark protocol, it gave the US a license to print money because every government in the world had to buy dollars to buy oil. Thus, because of this demand for dollars (like demand for any other item) the fed printed billions trillions more than what the US economy is worth in order to feed the integral role of being a global currency. That's why we can have a national debt of $10 trilion now? or is it higher... without having our money go to the dumps because everyone depends on it. If any other country carried this much debt, their currency would already had at least 3 revisions by now. However, the dollar and the yen are still seen as haven currencies. Remember the start of the banking crisis how the EUR was at $1.28 and the GBP was at $1.38 and silver was at $9? (It wasn't that long ago) That was because people still wanted a safe currency, which happens to be the dollar. However, if OPEC ever goes back on that protocol and switch to a different currency (let's say the EUR) then all the central banks of the world would have to flush their vaults of all stockpiles of dollars and buy Euros. And if this happens, all the dollars would have to flock back to Manhattan and DC, and the Fed will not have enough EUR to pay for the USD (since I mean, the money supply is like 4x our economic strength) and will cause a total collapse of the dollar on the open market. And that would be the federal reserve's worst nightmare. Now, why doesn't anyone do this yet? They all have T notes, T bonds and other government securities. If the world is planning to do this, then it would be a slow process that is easily seen since they would have to allow the notes to mature first (~5 to 10 years) and then (shockingly!) not buy any more. Plus, as America we still gotz da capabilities (militarily). If Iran (which is seriously showing interest in using the Euro and have the oil) ever decides to switch, oh lordy, I'm going to Switzerland. |
|
Pillar of the Community
Australia
2830 Posts |
G'day, WD - you don't think decades of U.S. budget deficits has anything to do with the money supply ?
Peter in Oz
|
|
Pillar of the Community
Canada
1248 Posts |
Buy Canadian silver and gold coins.....
few weeks ago I suggested Can $ will go uppppppppp
HHB
|
|
Pillar of the Community
United States
3098 Posts |
Quote:
G'day, WD - you don't think decades of U.S. budget deficits has anything to do with the money supply ? Not really... There doesn't seem to be a correlation between debt and the fed's interest rates... It really seems like public debt doesn't affect the growth of the economy. Quote:
few weeks ago I suggested Can $ will go uppppppppp haha Mr. CAD Pitchman. It did, and guess what? So did the AUD! By a larger percentage! So when are you guys going to push out the $200 note and the $5 coin?  |
|
Bedrock of the Community
United States
10982 Posts |
Quote:
G'day, WD - you don't think decades of U.S. budget deficits has anything to do with the money supply ?
Peter in Oz
I believe that this will be a major issue in the not too distant future. "Servicing" the U.S. national debt already amounts to 1/3 of the U.S. Federal budget (2008) and is growing at what seems to be an exponential rate. This will come to a head within 20 years and likely sooner. America must get a handle on deficit spending before it's too late (if it's not already). As far as Hyper-Inflation, I don't foresee that happening unless we don't get a handle on the above mentioned topic. IMHO we'll see significant inflation begin late next year and continue at 4 to 6% for sometime. Worst case scenarios could put inflation at 8-9% and that's if we keep spending like we have lately, which I believe we won't after this year (if fiscal sanity prevails). Anyway; that's still no where near Hyper-Inflation but 6% is bad and probably unavoidable for early in the next decade. It's safe to assume that everyday life will be much more expensive 5 years from now than it is today (and relative to the low inflation we've experienced of late). Don't panic but be cautious, use your skills and your instincts to get through what is going to be a tough few years ahead of us. Prosperity will return but it will take several years to get out of the mess we've gotten ourselves into. |
|
Valued Member
United States
207 Posts |
So it sounds like the US gov has pegged OPEC with the US dollar like they controlled the exchange rates with the Bretton woods system using gold. If the OPEC nations did decide to exchange the US dollar for the Euro, which in my opinion would probably work out better for them in the long run based on the dollars fall, then we would run into some type of massive inflation on the US dollar? It seems like a lot of the USD is being held off by countries outside America and is not really in circulation. The Euro nations are not running up as much debit as we are and they refused to add more debit to themselves when obama asked them too a few weeks ago. Do you think we should watch both what OPEC is doing and also what China will do with the dollar? China seems to be another front for the battle of the future of the USD.
Edited by markapsolon
05/26/2009 12:09 pm
|
|
Pillar of the Community
United States
2600 Posts |
China, like Japan, has become so tied to the U.S. economy as a part of it's GNP that it can't abandon holding U.S. debt. Dumping this debt would destroy a portion of that investment as they would drive the value of what they hold down at the same time diminishing the market they so need. What does it tell you when the number one importer of Chinese product is Walmart. Jim |
|
Pillar of the Community
Australia
2830 Posts |
G'day, it may be that the only support for the USD is the PRC ... and only because they hold so many greenbacks that they can't extricate themselves quickly. The word a month ago was that China was stockpiling copper, as a means of ridding itself of USD. If China pulls out of the USD, there isn't much else to hold up the greenback.
quote: "There doesn't seem to be a correlation between debt and the fed's interest rates... "
- isn't that part of the problem ? Sub-Prime, on a national scale ?
quote: "It seems like a lot of the USD is being held off by countries outside America and is not really in circulation."
- but that currency can re-enter circulation at any time. A perception that there is a fall in value in the pipeline may be enough to trigger a flushing out of foreign holdings.
Peter in Oz
|
|
Pillar of the Community
United Kingdom
1682 Posts |
The pound is worth a $1.60 today. First time in 7 months. I can recall last year when the pound was worth $2.
|
| |
Replies: 21 / Views: 2,755 |
Posted 05/22/2009 4:14 pm
