THE dollar has embarked on a big decline that will see it fall against all leading currencies, according to analysts.You think gas prices are high now? Imagine what will happen if, when, oil is denominated in the euro, with Iran leading the way.
The plunge is being prompted by America’s $800 billion (£438 billion) current-account deficit, they say.
China announced in July of 2005 that it would divorce its curency from the dollar. Those low, low WalMart prices won't last forever. More than that: China gets much of its oil from Iran. A U.S. nuclear attack on Iran could cause Asia to declare an economic war on the United States by refusing to service our deficit. Why should the Chinese continue to keep alive the creature that attacked a chief supplier?
And why should any foreign investor keep tossing money into our stock market? A dropping dollar insures losses, even when stocks perform well.
The good news: American-made goods will be be cheaper overseas. The bad news: We don't make anything anymore.
3 comments:
These are the last days for the dollar. The dire straits of US finances has a lot to do with the price of oil, as well as the exploding prices of metals, precious and otherwise, which have all about doubled in the past six months.
We are in a commodity bull market, likely to last another decade. If you are in equities or real estate, get out now, before the exits are jammed. As expensive as gold and silver have become, they are still cheap compared to what they will be in a few more years.
Bush is finished. Not because of Iraq, but because the collapse of our economy is coming on his watch. As goes Bush, so goes the whole Republican Party, which is about to follow the Whig and Federalist Parties into extinction.
The big question for me is this: who gets the blame for the coming train wreck? This time around, I don't think it will be the Jews. My bet is on the Christian Fundamentalists. Things may even get so bad that Christianity as a whole is blamed.
It's going to be a different world, that's for sure. Prepare as best you can.
unirealist, i am always fascinated with your comments, especially on matters economic, and almost always agree, in general and detail.
however, though there is no question the us economy is doomed - almoast intentionally so, one would wonder - and well on its way downhill, you imply that the dive 'has to do' with the exploding metal prices. from where i sit, the prices are more dependent on the dollar's dive. think about it: thought the price of silver appears to have skyrocketed in recent months/years, the fact is that the dollar being used to value each ounce has declined in value itself. i'd be interested to see actual charts on the buying power of an ounce of silver from 1990 to now; the incline will not be nearly as steep as it appears using only the number of dollars on the vertical ordinate.
and i'd have to say that, although you're right in terms of public opinion that we will take bush down because of the crashing economy, that crashing economy is actually a result and function of iraq. all those billions and billions of dollars either literally blown up or literally pocketed by halliburton et al. and the various bribees. the world watches all this, and the 'decider' who is marching us hell-bent over the cliff, and is left to the no-brainer choice of avoiding any investment in the us dollar.
i do agree that the repug party is in its terminal stages, but i don't know if the fundamentalists will be the locus of blame entirely. there are many jews who have contributed to this holy mess, if you will, not to mention all those obscenely wealthy corporate fatcats.
i for one will have a hard time leaving folks of that ilk out of my range of culpability. that would not include the christian impulse, however, as the teachings of jesus provide us with a huge number of answers to the problems we face, being the liberal populist that he was. (and i feel the need to explain that i do not belong to any christian faith or sect, but practice a buddhist meditation.) we must all be careful to avoid throwing babies out with bathwater in the coming purge.
lll-- we are not in disagreement, it seems to me. My advice, pick up some silver dollars at your local coin shop. --S.
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