The demise of the dollar

[StageLeft]

Originally posted by: dmcowen674

Originally posted by: rdubbz420

Originally posted by: dmcowen674
Oil will cost America $700 U.S. dollar a barrel

and you're so good with predictions. :roll:

Yes I am, what have you done lately?

$5 milk and $500 oil predictions FTL

Oh and 3600 DOW

 

[totalnoob]

uh oh spaghetti-oh..

G7 Abandons the Dollar

http://www.forbes.com/2009/10/...-foreign-exchange.html

 

[StageLeft]

Originally posted by: totalnoob
uh oh spaghetti-oh..

G7 Abandons the Dollar

http://www.forbes.com/2009/10/...-foreign-exchange.html

I LOVE how the front page calls itself a "welcome screen". Motherfvcker, ads are never welcome, Forbes.

Thanks for the link, though!

 

[JSt0rm]

well I'm not in finance but I feel as though my industry needs a influx of capitol from people who want to invest in something. All these people sitting on the sidelines with their dollars will want to start moving them. Is this a correct assessment?

 

[nullzero]

Well gold hit an all time record high today... Dollar continues to sink.

 

[LegendKiller]

Originally posted by: nullzero
Well gold hit an all time record high today... Dollar continues to sink.

So what?

 

[JSt0rm]

Originally posted by: LegendKiller

Originally posted by: nullzero
Well gold hit an all time record high today... Dollar continues to sink.

So what?

hey LK would you mind talking about how this could help our economy because people and banks will want to start moving these lower value dollars? If I am wrong I'm wrong but it just makes sense to me.

 

[Munky]

Hahaha! Running out of oil... that's what the fat cats want you to think as they laugh all the way to the bank.

 

[LegendKiller]

Originally posted by: JSt0rm01

Originally posted by: LegendKiller

Originally posted by: nullzero
Well gold hit an all time record high today... Dollar continues to sink.

So what?

hey LK would you mind talking about how this could help our economy because people and banks will want to start moving these lower value dollars? If I am wrong I'm wrong but it just makes sense to me.

It'll spur demand for our goods internationally but hurt imported goods.

The big thing is that currency fluctuations aren't really a sign that a currency is weak our strong, or that you're doing the wrong thing. It's a reflection of a multitude of decisions, not only fiscal and monetary policy of your own country, but also the fiscal and monetary policy of every other country on the planet. Another huge factor is the relative value of every other asset out there.

People think that this measurement in time really matters. It doesn't. Gold was at almost 860 in Feb 1980. Interestingly enough, around the same time, the DJIA was at 860 also.

 

[IndyColtsFan]

Originally posted by: dmcowen674

Originally posted by: rdubbz420

Originally posted by: dmcowen674
Oil will cost America $700 U.S. dollar a barrel

and you're so good with predictions. :roll:

Yes I am, what have you done lately?

Yeah, you were SPOT ON with that $10/gal gas prediction, not to mention your ridiculous prediction that McCain was going to win the election which you even made within days of the election, DESPITE all of the indicators to the contrary. I am sure I can dig up more of your ridiculous predictions with a simple search but I don't want to waste my time.

 

[miketheidiot]

Originally posted by: totalnoob
uh oh spaghetti-oh..

G7 Abandons the Dollar

http://www.forbes.com/2009/10/...-foreign-exchange.html

i'm not sure if you read the article, but you certainly didn't comprehend it.

The problem with intervention is that it would only be partially effective, especially if the U.S. isn't on board. The Treasury Department would never admit this, but for the time being it's in the country's interest to keep its currency low because it stimulates exports for the economy's manufacturing base and lowers the value of the debt that the Treasury is piling up.

the treasury is letting the dollar go low to stimulate manufacturing, although it would be better if china let their currency float. This has nothing to do with anyone abandoning the dollar

 

[JSt0rm]

we make movies here and we need to compete with a host of players all over the world. I was talking to Dane Davis a couple of weeks ago (sound designer on the matrix films) and he was talking about how hard it is to compete with post/editorial houses in New Zealand and Canada because of the additional costs he has to add for things like healthcare. A weaker dollar will certainly help him tip the balance back in his favor. Honestly for my industry it can only help.

 

[ahurtt]

What the countries who were alleged to have been in talks do next will tell us whether or not what the article speculates is true. Watch for countries who are known to hold hordes of dollars (China???) to start unloading them back on us ahead of any major move toward this policy if it is true. They are going to make sure they don't make their own investments worthless before they have the chance to get rid of them. If that happens, prepare for major inflation as we'll soon be swimming in our own worthless paper. I'm guessing you'll start seeing foreign entities buying up interest in U.S. corporations and such in unprecedented amounts to try and get rid of their dollar reserves.

 

[totalnoob]

Originally posted by: ahurtt
Watch for countries who are known to hold hordes of dollars (China???) to start unloading them back on us ahead of any major move toward this policy if it is true. They are going to make sure they don't make their own investments worthless before they have the chance to get rid of them. If that happens, prepare for major inflation as we'll soon be swimming in our own worthless paper. I'm guessing you'll start seeing foreign entities buying up interest in U.S. corporations and such in unprecedented amounts to try and get rid of their dollar reserves.

So what? [/Legendkiller impression]

 

[LegendKiller]

Originally posted by: totalnoob

Originally posted by: ahurtt
Watch for countries who are known to hold hordes of dollars (China???) to start unloading them back on us ahead of any major move toward this policy if it is true. They are going to make sure they don't make their own investments worthless before they have the chance to get rid of them. If that happens, prepare for major inflation as we'll soon be swimming in our own worthless paper. I'm guessing you'll start seeing foreign entities buying up interest in U.S. corporations and such in unprecedented amounts to try and get rid of their dollar reserves.

So what? [/Legendkiller impression]

Actually, the post makes no sense at all.

1. The artcle isn't true, this guy has been known to post stupid shit like this in the past and even has a an act of "utter futation" named after him "Fisking", because he posts stupid shit that's easily refutable by anybody with actual knowledge.

2. Even if it were true, China *CAN'T* make any moves against the dollar. Considering we comprise more than 30% of their current exports, any move against the dollar would be a move against themselves. Even though the RMB is quasi-linked to the USD, it isn't fully, and a complete collapse of the dollar would utterly destroy the RMB's parity with other world currencies, effectively crippling the world FX market.

Furthermore, even if China delinked from the USD and dumped USD, their single biggest trading partner is gone, as are, effectively, every other trading partner since suddenly the RMB is massively inflated vs other currencies, destroying the Euro and everything else.

Even if they found a way around THAT problem, there is still the fact that they have so many US Treasuries that they cannot hope to unload them prior to the collapse of the UST market.

Even if they were able to delink the RMB, find somebody else to buy cheap chinese stuff, AND sell all of the treasuries all at once without massive losses, then what will they do with all of the currency they have in reserve? They won't want to buy US stuff since the US is now destroyed, so they're fucked.

3. Nothing is "worthless". The comment itself underlies the poster's own ignorance, or, at least, lust for hyperbole. Pretty much everything on the planet is worth something (even my worthless brother in law). The USD is worth a lot, since it is still backed by the world's largest economy, military, and effecient democratic process.

4. Then the poster doubles down with "major inflation". How can there be "major inflation" if there is a huge contraction in dollars in the market? The destruction of wealth has been far larger than the creation of it.

5. Sure, they could buy them up, but I think everybody learned the lesson of Japan in the 80s and 90s. Sure, we may be "down" right now, but not for the count. There isn't a single country on the face of the planet with a larger base of IP and innovation in the world.

 

[JSt0rm]

inflation would be good right now. We need to get what little cash is sitting on the sidelines in the game.

 

[Colt45]

Originally posted by: JS80

Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.

Outside of the yen, the listed monies are pretty much lol.

Since when is the euro a "lol currency"?

 

[rchiu]

Originally posted by: LegendKiller

Originally posted by: totalnoob

Originally posted by: ahurtt
Watch for countries who are known to hold hordes of dollars (China???) to start unloading them back on us ahead of any major move toward this policy if it is true. They are going to make sure they don't make their own investments worthless before they have the chance to get rid of them. If that happens, prepare for major inflation as we'll soon be swimming in our own worthless paper. I'm guessing you'll start seeing foreign entities buying up interest in U.S. corporations and such in unprecedented amounts to try and get rid of their dollar reserves.

So what? [/Legendkiller impression]

Actually, the post makes no sense at all.

1. The artcle isn't true, this guy has been known to post stupid shit like this in the past and even has a an act of "utter futation" named after him "Fisking", because he posts stupid shit that's easily refutable by anybody with actual knowledge.

2. Even if it were true, China *CAN'T* make any moves against the dollar. Considering we comprise more than 30% of their current exports, any move against the dollar would be a move against themselves. Even though the RMB is quasi-linked to the USD, it isn't fully, and a complete collapse of the dollar would utterly destroy the RMB's parity with other world currencies, effectively crippling the world FX market.

Furthermore, even if China delinked from the USD and dumped USD, their single biggest trading partner is gone, as are, effectively, every other trading partner since suddenly the RMB is massively inflated vs other currencies, destroying the Euro and everything else.

Even if they found a way around THAT problem, there is still the fact that they have so many US Treasuries that they cannot hope to unload them prior to the collapse of the UST market.

Even if they were able to delink the RMB, find somebody else to buy cheap chinese stuff, AND sell all of the treasuries all at once without massive losses, then what will they do with all of the currency they have in reserve? They won't want to buy US stuff since the US is now destroyed, so they're fucked.

3. Nothing is "worthless". The comment itself underlies the poster's own ignorance, or, at least, lust for hyperbole. Pretty much everything on the planet is worth something (even my worthless brother in law). The USD is worth a lot, since it is still backed by the world's largest economy, military, and effecient democratic process.

4. Then the poster doubles down with "major inflation". How can there be "major inflation" if there is a huge contraction in dollars in the market? The destruction of wealth has been far larger than the creation of it.

5. Sure, they could buy them up, but I think everybody learned the lesson of Japan in the 80s and 90s. Sure, we may be "down" right now, but not for the count. There isn't a single country on the face of the planet with a larger base of IP and innovation in the world.

China can and is moving against the dollar. Well maybe not with the intention to directly hurt USD fx rate, but they definitely want to reduce their reliance on USD for investment and raw material trades.

Oh and this is directly from a friend working for China Investment Corporation that looks at investing China's large foreign exchange reserves.

And yeah, the OP and the article is over the top and we will certainly not see a dollar's collapse. But there is definitely a trend in BRIC/EU countries to start looking at alternatives (Euro or basket of currencies) for trade, and non-dollar investment to hedge against US dollar, US economy and US politics. I don't think USD will be irrelavent, but I do see one or two options emerging in global trade (actually Euro is becoming a vaible alternative already) and investment, and the demand for dollar will be reduced for certain.

How much of it is gonna impact USD exchange rate? well there are way to counter the lowered demand so I am sure Fed will figure something out.

 

[santz]

lol my friend, you have it wrong, atleast some of it. I live in dubai and work in the financial industry. the single currency that the middle east wants established is atleast 3-5 years away and has been in the planning for at least a decade and has always been postponed because no one is ready.

abu dhabi is not a country, it is a city in UAE. The UAE about 6 months ago pulled out of the single currency planned by the saudi arabia and plans to stick with the dolla for the near future as saudi laws are non existent and corruption runs rampant at high levels