Sinking Currency, Sinking Country

Originally posted by GradyPhilpott

Things have never been quite like they are now.

I agree with you GradyP. When comparison's are drawn between today's economic climate and the depression years, contemporary analysts are usually quick to point-out a few key differences:

The US was energy independent in 30's. We were the world's manufacturing leader. We were the world's largest creditor, and our currency was backed by Gold.

Given free reign to monetize, pain has been forestalled by rolling-over deteriorating bubbles to the point of creating the largest glut of global liquidity in history...much larger than the 1930's. Currently central banks are doing what they do best...attempting to stave-off recession with re-inflation. It's all they can do short of raising taxes, cutting federal spending (hard to do when you're funding two off-budget wars), and allowing recessionary forces to play-out and settle the imbalances. Problem is that the solutions are all politically unsatisfactory. When you see the President paraded-out to jawbone the economy almost on a daily basis now...sumtin's up. In his piece, Buchanan says that it's not GWB's fault. I say that statement is both true & false. True, Bush was handed the toxic economic baton by his predecessor, but it was under his watch that the Greenspan rate-cuts occurred...fueling the current leg of the housing/credit bubble. True courage-in-leadership would be to take the medicine. But again, the fix was politically untenable, Buchanan claims it was impossible. The question becomes; can they hold the ship together until GW leaves office next year...force the implosion to occur on a democrats watch? Since breaking below 80.00, every attempt to rally the Dollar has fizzled. I don't expect this to change. The Fed won't hesitate to cut next session if the markets hold their feet-to-the-fire. In fact, an emergency cut wouldn't surprise me.

Speculators front-ran the oil inventory report today (released at noon), and oil sold-off a bit. Overall, inventories declined less than expected, but they did continue to decline at the 'benchmark' Cushing Terminal, so today's report was basically interpreted a flat. Apparently many believe that specs have pushed prices far beyond fundamentals, and they anticipate a reasonable pull-back...good chance if the Dollar cooperates, but an IEA Report released today suggests continued bad news for oil prices. I expect a couple of runs at $100 before it cracks.

The Yen-carry-trade is still alive and well. When I see the US/JPY strengthen above 114.00 and hold, like it did last night...a sell-off in US equities is sure to follow. Further evidence was seen in the sell-off of AUD & NZD carry-trade currencies.

In the end, I'm on board with those calling for stagflation, or inflationary recession/depression. Timing?

Originally posted by traderonwallst
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.

They do export...jobs

Yes I agree with Obe. The fed will continue to cut rates until the dems take office...then the crap will hit the fan.

We all must shoulder some of the blame for this crisis. Primarily the "something for nothing" culture we live in today.

But I blame Reagan, Bush, Clinton and Bush Jr for this mess. Instead of taking our medicine they either borrowed or scammed temporary success.

Looks like they are fresh out of scams!

Assuming you're still profiting in the demise, how will you stay afloat when the country sinks?

Is buying gold the only option? Your fat bank account isn't going to be worth much if it's in dollars and the dollar has no value.

What about the people already drowning in financial woes, wouldn't a total collapse of the system actually benefit them more? With everyone on the sinking ship, the life raft that the government will eventually throw out..would be bigger...

My personal approach has been to move 80% of my assets overseas. I am currently using the Euro Pacific Capital to move my funds. It has been somewhat of a headache due to the amount of paperwork, but it will be worth it in the long run. If or when the American dollar does crash I will be able to convert small amounts of income coming from my investments into dollars/Ameros..etc to live on as needed. This way I will hopefully be protected from devaluation of my overall asset base. The Brazilians became experts at electronic money transfers to other currencies when the rial was experiencing rapid inflation...I expect Americans will soon have to learn also.

If your not completely out of debt, spreading your liquidity around in foreign currencies and loaded to the gills with pm's and commodities by now...then at least stock up on food, drugs and guns.

It's going to get real ugly as the end game unfolds.

Originally posted by DJMessiah

If items cost less here than they did before, then wouldn't you buy them? China is one of our number one exporters because of the effect of the dollar's price, and also our number one importer of manufactured goods.

Just two problems with that. The first is that China has deliberately pegged their currency to the US dollar so that their goods will always be cheaper. This why they can suck off the US economy like a vampire, building up their military until they are ready to strike.

The second problem is that the Chinese have 30% tariffs on all foreign goods. I guess tariffs haven't hurt their economy much. So much for the 'benefits' of globalism. Our idiotic cowardly leaders have prostituted themselves to these rotten globalists with nary a twinge of their consciences.

I'd say we are in a world of hurt unless these creeps are thrown out. Yet another reason to vote Ron Paul.

Someday, the people going to their 9-5 jobs, making products, and providing services, will get tired of the people who sit behind a computer, trading their goods and services, making a huge amount of profit.

You break the backs of the slaves (US labor force) enough times, they

are going to get tired of it. I know I am.

The answer is more localized food growth, production of goods.

Take out the middle man, who continues to get greedier by the day.

I might add, the trend lately has been for the traders to bet on the FAILURE of stocks.

Take the put options on American Airlines before 9/11 for example.

Please, please, think more carefully. The handwriting truly is on the wall.
The world is being manipulated into WWlll and global economic collapse.
The paradigm's we've been taught are being used against us. It's ALWAYS been a giant ponzi scheme, and now we lost our Rights, too.

Right and Left have been a sham to preoccupy us. Look through new eyes. Please.

spitted rat tastes pretty good i hear....

What is happenning to the US economy is what happenned before the first and second world war.Read the lines.
Everything is gearing to the 3rd world war which is not far of now.
Be prepared.
They are making a case to cause havoc and kill.

Originally posted by shenkes
What is happenning to the US economy is what happenned before the first and second world war.Read the lines.
Everything is gearing to the 3rd world war which is not far of now.
Be prepared.
They are making a case to cause havoc and kill.

A man heart is filled with deciet and hatered.
Only the wise and brave can overcome his greatest fear.
What does america fear.
Lose of economic rights

Originally posted by worldwatcher

Is buying gold the only option? Your fat bank account isn't going to be worth much if it's in dollars and the dollar has no value.

What about the people already drowning in financial woes, wouldn't a total collapse of the system actually benefit them more?

A) not just gold, convert your gold stocks/holdings into 80-95% silver when you see the Amero as a certain thing to happen.
the Fed Reserve Notes, aka USD, might well become a type of
'weimar' Dollar...it's up to you to decide when/where to sidestep the fall.

B) Yeah, "they will benefit"........as they scratch out a existance in a 21st century 'Grapes of Wrath' redux.....where the bottom 60% are reduced to squalor and camp living




i'm sure you and others can figure out a strategy,
there just ain't no sure fire answers...only general directions,


best to ya,

Some here might not believe what I say, but I swear it is true. I went to the grocery store tonight and handed cash to the checkout girl and guess what happened? She actually accepted it as payment. Guess the dollar isn't dead quite yet.

10 year treasury is yielding 4.2%. If the dollar was going to continue to fall and eventually be worthless, and hyperinflation was just around the corner who the heck would buy a treasury yielding 4.2%? If their wasn't buyers the yield would rise until there was. The treasury yields tell us that the dollar and inflation are about to reverse their courses big time.

reply to post by disgustedbyhumanity


Is that why China,Saudi Arabia,South Korea,Venezuela, Sudan, Iran and Russia are moving away from the dollar as the main currency reserve? If this was a short term problem they would hang on to those dollars............you would think?

7 Countries moving away from the US dollar

reply to post by disgustedbyhumanity

10 year treasury is yielding 4.2%. If the dollar was going to continue to fall and eventually be worthless, and hyperinflation was just around the corner who the heck would buy a treasury yielding 4.2%? If their wasn't buyers the yield would rise until there was.

4.2% of what though? A currency that has been printed into worthlessness. 4.2% of nothing is still nothing. The Fed will print more money to pay debt that just reduces the value of the existing currency. The 'yield' becomes meaningless when it is based on money created from thin air. The rest of the world knows this and they are proceeding accordingly. Just read analysis on the last TIC report and look at what China is openly saying.

Biggest problem I see right now is the credit crunch created by the sub-prime crisis. There are literally thousands of foreclosures being written off and/or still to hit the fan.

The only way around this is to allow refinancing to these people into coventional payments even though their homes/investments don't appraise at the value owed. If the gov't/banks would step in and allow refinancing on these properties, many would still be able to avoid foreclosure. Isn't something of something better than nothing of nothing?

The impact of all these foreclosures will take years to recoup from. why not let these people get monthly payments that will allow them to keep their homes/investments - it's got to be better than foreclosing all these loans.