Sinking Currency, Sinking Country

Originally posted by GradyPhilpott

I noticed myself that the rise in oil prices lately hasn't been accompanied by the usual tales of woe like embargoes, natural disasters, or increased demand. Then I read a story that oil prices are being driven up by traders. That's not necessarily good news, but it's likely to be a transitory problem, unlike massive infrastructure damage.

newpaper.asia1.com.sg...


[edit on 2007/11/7 by GradyPhilpott]

You hit this right on the head!!!!! Why is OIL going to 100? Becauser traders want it to!, Why does the US$ continue to go lower? Because traders want it to. These are trades that are working in troubled times. In times like this, traders hold on to their winning trades. With just about everyone playing the short side of the Dollar and the long side of the oil market, this will continue to go on. THE #1 RULE OF TRADING IS.....the trend is your friend.

So, until the trend is broken, you will continue to see this trade flow. Although less new money is being put in play here. I really do see a correction coming. By the way, the items I talked about at inverse price dependent on each other. As the value of the US$ declines, the price of OIL goes up, and vice-versa. Traders are not stuipd and know this. So by winning on one side of the trade they know the other side is a win too. So they pla both sides...putting pressure on pricing twice, gaining a double profit.

The trade used to be the carry trade, use the $ to buy yen, borrow in yen and invest the money. See the profit from the return and again when you convert back to the US$. That trade is doen, so they found a new trade. Everyone has jumped on board, but this has been so out played that a bounce could cause panic buying (Could, but not likely).

The lower the $ goes, the higher oil prices go. Everyone is screaming about $100 a barrel oil. If Oil was priced in Euros, would we have seen the same % appreciation in price that we have seen in US$? NO....although, if it were priced in Euro's we could be having this conversation right about about the ultra-weak Euro and not the Dollar.

This was a trade of opportunity. When the trade comes off, the dollar will rise and price of oil will fall. Eventually it will come back to where it should be based on fundamentals, everything does!!!!!! (CYCLES)

reply to post by Niall197


I agree with you. One point though. I believe that all that stuff comes from Japan not China.

reply to post by worldwatcher


Correct. And the apparent glee at the "demise" of U.S. currency etc. by some posters means they also do not understand that much of the investments and therefore much of the losses will be born by the average working class American who's retirement funds have been invested for him by pension plans.

And I thought these (naive?) people always claimed to hate only the U.S. government and not the people ...



[edit on 11/7/2007 by centurion1211]

reply to post by Daz3d-n-Confus3d


Point taken

Ach I was making a general point. Substitute N64 & PS1 for any number of bits of junk which were yesterdays "must haves" and which are now todays landfill. In 5 years time the PS3 and Xbox360 will be little more than a nostalgia piece on Wiki. But your parents might still be paying for them. That's how absurd things are getting.

Anecdote of the day. My Dad was Royal Navy & he's great friends with one of his former colleagues from the USN (ex-USS Forrestal) who came over here a few weeks back for a visit. We got talking about navy stuff & my Dad casually mentioned that it was a shame that the UK couldn't afford the big supercarriers like the ones the US has. And his friend said neither could the USA. They just borrowed the money to build them. And all that money for huge impressive warships ... some now at the end of their careers and languishing as museum ships or cut up at the breakers ... is still owed.

Same with Glasgow City Council. Still paying for homes built in the 1960's which have now been demolished. How mad is that ?

Borrow now, pay later, easy terms.

I'm not arguing we should abandon capitalism and go live the lives of the Amish (although I'm a bit tempted I have to admit). When I was a kid I always wanted ... what the kid next door had. And kids like me tend to grow up to become adults with the same outlook ... always wanting what the neighbours have or the friends have.

But if your neighbours and friends have all this kit and are up to their eyeballs in debt you've just got to take a step back and say ....whoa ... somethings not right here. Time to get off the train before it hits the buffers.

America, as a nation has turned "stupid", and you can't fix stupid.

reply to post by pc is here


If you're referring to the amount of "PC" we now have to deal with in the U.S., I would have to agree.

Can't get more stupid than that IMO.




[edit on 11/7/2007 by centurion1211]

So basically the subject of all these end of the world threads should be "Vote Democrat in 2008"

reply to post by centurion1211


-----point proven---------(thanks)

reply to post by SKMDC1


Yes, vote democrat. especially if your in favor or eliminating the Bush tax cuts, and then having Rangels tax increase implemented. They are playing it off as a 4% increase in taxes, but what they are not telling you is, that 4% is after the Bush tax cuts are repealed. The tax increase is much greater than anyone knows!!!!!!!!!

Vote Democrat if you like taxes.

reply to post by traderonwallst


I could vote for Obama, not Hillary or Ron Paul, not Guiliani.

I'm wondering how long I will be able to remain in business. I decided back in June of this year to open my own game store. By the middle of September I officially opened. While I was opening I started hearing and paying attention to all the business news about the real estate credit crunch and the dollar falling and the reports of the upcoming holiday season being slow compared to years before. I know the first retail stores to go belly up are going to be small self-owned kind and being the new kid on the block I will probably be one of the first to have to close up shop. The little guys are going to get hurt a lot while the big corporations will be able to ride it out a lot longer. Sad thing is once small businesses close down only place left to go for a job will be the major retail stores. Then once the market does start to improve the major stores will have a lot less competition and more profits to earn.

A weaker dollar also means more exports, something this country desperatly needs.

reply to post by ChrisJr03


Pardon my ignorance, but what exactly can the US export these days? Almost every consumer product is manufactured in China, Taiwan, Korea or Japan these days. Meanwhile the chips in your PC are manufactured in Malaysia, as are the hard drives.

The only thing I can think of that the US can export are those that only governments can afford, like your F15s. And those sort of sales don't come very often, do they?

reply to post by Beachcoma


Sede john Deere, Unioted Technologies, Catepillar, Precision Cast Parts. Tons of American COmpanies export. They are all the companies still actually having profits. Too bad GM does not export.

reply to post by traderonwallst


Most of those companies you listed have operations outside of the US. Is it a US export if it's from a non-US location to another non-US location? The company may be American, but it's an MNC.

BTW my dad was working for UTC until he decided he didn't want to work any more for a company that produces weapons.

reply to post by Beachcoma


United Technologies makes a lot more than weapons, but its a good thing they do. More money for them, good defenses for US!

To be honest, sometimes I don;t get that whole bite of your nose to spite your face mentality, but if it helps him sleep at night...more power to him.

reply to post by Beachcoma


By the way...just about any company that produces anything technicall could be accused of making weapons. The other day, I grabbed my key board and hurled it across the room at some idiot in the room. I guess that keyboard was technically a weapon (not really happened, but thought it was funny to say)

reply to post by traderonwallst


He was kind of getting annoyed by the office politics. After 10+ years, he decided to leave. Personally I think it's got more to do with that than the weapons thing, after all he was at the company for over a decade.

reply to post by GradyPhilpott


Dam* Grady, that actually made sense. Are you sure you're posting in the right place?

Raf

The manufacturing base of the United States has been has steadily moving overseas due to NAFTA and other free trade agreements. This has left the United States a hollow shell economically since we do not produce true wealth anymore. In our service based economy what do we produce? Nothing...but we export information for a price. In a global market what prevents someone else with a much lower wage scale from doing the same job for a cheaper price....nothing.

When or if there is a economic collapse the United States will be forced to back to the colonial model of exporting timber, minerals, natural resources etc. and other true items of value and wealth.



[edit on 7-11-2007 by BlueRidge]