Comments on Moses Kim's articles RSS Syndication from SeekingAlpha.com http://seekingalpha.com/author/moses-kim/articles http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-778324 778324 Thu, 26 Nov 2009 09:39:54 -0500
While the above comments focus on the US in isolation, the picture around the world is not as rosy either as all govts fight global recession. The pegged rate of the yuan is going to cause China the first inflationary mess as their middle class grows. Failure to allow the yuan to float will destroy their global status. Their selfish approach to competitive export prices will ultimately be destroyed by inflation that may become internally rampant.

Our global exports have not significantly declined notwithstanding the pegged yuan rate. At present, the Eurozone has had a diminishing share. With an unprecedented 6 billion people on the planet and growing, I would expect larger money supplies to grow to accomadate the medium of exchange.

The current account deficit in the US presents a major risk to the dollar. With globalization a new phenomena, the comparisons of deficits and govt funding will take on a new observation as GDP comparisons may be enlarged in global thinking. Our problem is that we have the largest GDP and the largest debt.

It is going to take more bank interaction to promote capitalism in credit based economies if we are going to reduce our debt structure,create more employment, increase the total tax receipts from employed citizens, and rebalance our govts relationship to its citizens.

How the value of the dollar fares in the global restruturing will be based more on our economic resilience to overcome debt.GI]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-778076 778076 Thu, 26 Nov 2009 00:11:00 -0500
User353732 is right that the dollar was strong as a consequence of the US' fundamental strength, however Kim is right that strength in the dollar is a fundamentally neccesary not just to be a reserve currency and let our government live well beyond its means every year, but is neccesary to make good rational business decisions and uphold our economy into the future.

The Federal Reserve should not be so lax in it's commitment to protecting not just the value of the dollar but our assets which most all are priced in US dollars. It is this that we are losing. Every drop in the US dollar can be seen either a as an indirect tax (taxation without representation on top of that) or as a theif stealing some percentage of our assets away and carting them away in the night. Both perceptions are deeply troubling and eat at the core of economic stability.

With over a 10% decline in the dollar YoY we will soon see if this will lead to the meltdown Kim and others are so fearful of if it happens in 2010. That is, unless Bernanke wakes up and grows some.]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-778073 778073 Thu, 26 Nov 2009 00:09:22 -0500
Yep, but there's a world market for 'em, and we'll end up paying the world market price as consumers, since producers have the option of sending production abroad should prices be insufficient here. The only good news is, at least price rises there don't add to the current accounts deficit.]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-778034 778034 The Great Depression was caused by deflation, not inflation. When > there is inflation, people buy things like crazy because the price > is going to go up tomorrow. The economy tends to get overheated - > there is a tendency for employment to be high because workers don't > realize that wage increases are illusory and therefore the real hourly > wage declines encourage employers to use more and more less expensive > labor as they can raise prices faster than wages increase. I am not > advocating inflation and I feel that today it is about as serious > a problem as large scale horse manure pollution due the the abandonment > of automobiles and the resumption of horse drawn carriage transportation. > But, even if inflation does recur (which I think is very, very unlikely > in the near term) it would not create a depression]]> Wed, 25 Nov 2009 23:01:59 -0500

On Nov 25 05:40 PM user396040 wrote:

> The Great Depression was caused by deflation, not inflation. When
> there is inflation, people buy things like crazy because the price
> is going to go up tomorrow. The economy tends to get overheated -
> there is a tendency for employment to be high because workers don't
> realize that wage increases are illusory and therefore the real hourly
> wage declines encourage employers to use more and more less expensive
> labor as they can raise prices faster than wages increase. I am not
> advocating inflation and I feel that today it is about as serious
> a problem as large scale horse manure pollution due the the abandonment
> of automobiles and the resumption of horse drawn carriage transportation.
> But, even if inflation does recur (which I think is very, very unlikely
> in the near term) it would not create a depression]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-778033 778033 Firstly, let's get one thing out of the way. Those unfunded liabilities > are pretty much a write-off. $100 trillion dollars? Are you kidding > me? Our government can barely afford the current $12 trillion debt > load with the current workforce..... and over the next 30 to 40 years, > our workforce will be dwindling. > > I don't think the general public appreciates, yet, the enormity of > the situation. $100 trillion dollars is equivalent to over a quarter > of a million dollars of debt for every man woman and child. For an > average family of four, that is more than a million dollars of debt > per household....present value!!! And for every year we run a deficit, > we add an equal amount to the unfunded liabilities. > > Needless to say, a reduction in the standard and quality of living > is an understatement. Bottom line is, our sick and elderly loved > ones are going to die prematurely..... and that's simply unacceptable. > > > The destruction in our standard of living will ultimately manifest > itself in the form of significantly higher taxes and the addition > of a multitude of user fees. At current debt levels (including the > unfunded), you can consider this new reality to be permanent. This > change will likely put the US at the top of the list of the highest > taxed nations in the world. The sad part is, most of the current > high-taxed nations have a decent health care system. We will be at > the top of the list with a crippled health care system. > > Has anyone ever considered that there will be a mass exodus of our > mosted talented and highly contributing pool of workers (and businesses)? > This will be especially true if Obama continues to push his socialist > agenda. > > I gotta say, Canada is starting to look mighty sweet right now... > I don't care how bad their hockey teams are...]]> Wed, 25 Nov 2009 23:00:32 -0500

On Nov 25 10:42 AM Mr. Big wrote:

> Firstly, let's get one thing out of the way. Those unfunded liabilities
> are pretty much a write-off. $100 trillion dollars? Are you kidding
> me? Our government can barely afford the current $12 trillion debt
> load with the current workforce..... and over the next 30 to 40 years,
> our workforce will be dwindling.
>
> I don't think the general public appreciates, yet, the enormity of
> the situation. $100 trillion dollars is equivalent to over a quarter
> of a million dollars of debt for every man woman and child. For an
> average family of four, that is more than a million dollars of debt
> per household....present value!!! And for every year we run a deficit,
> we add an equal amount to the unfunded liabilities.
>
> Needless to say, a reduction in the standard and quality of living
> is an understatement. Bottom line is, our sick and elderly loved
> ones are going to die prematurely..... and that's simply unacceptable.
>
>
> The destruction in our standard of living will ultimately manifest
> itself in the form of significantly higher taxes and the addition
> of a multitude of user fees. At current debt levels (including the
> unfunded), you can consider this new reality to be permanent. This
> change will likely put the US at the top of the list of the highest
> taxed nations in the world. The sad part is, most of the current
> high-taxed nations have a decent health care system. We will be at
> the top of the list with a crippled health care system.
>
> Has anyone ever considered that there will be a mass exodus of our
> mosted talented and highly contributing pool of workers (and businesses)?
> This will be especially true if Obama continues to push his socialist
> agenda.
>
> I gotta say, Canada is starting to look mighty sweet right now...
> I don't care how bad their hockey teams are...]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777863 777863 "For one, it makes imports more expensive, which is effectively inflation. > Ultimately, this means a standard of living lower than what we have > come to expect. If confidence in the dollar totally erodes, then > things will really get ugly." > > Well said. While we can do without the newest iPhone, HD-TV, or Honda, > there are commodities that we have to compete with other nations > to buy, nations with sounder currencies: > > * Petroleum > * Grain > * Coal > * Copper > > If there is a run on the dollar, and I personally believe that such > a run WILL occur, the above commodities and their byproducts will > become much more expensive.]]> Wed, 25 Nov 2009 18:39:23 -0500
You can take coal and grain off the list, as the US is doing ok with those....of course, not so much with oil and copper.


On Nov 25 02:48 PM Carlos Lam wrote:

> "For one, it makes imports more expensive, which is effectively inflation.
> Ultimately, this means a standard of living lower than what we have
> come to expect. If confidence in the dollar totally erodes, then
> things will really get ugly."
>
> Well said. While we can do without the newest iPhone, HD-TV, or Honda,
> there are commodities that we have to compete with other nations
> to buy, nations with sounder currencies:
>
> * Petroleum
> * Grain
> * Coal
> * Copper
>
> If there is a run on the dollar, and I personally believe that such
> a run WILL occur, the above commodities and their byproducts will
> become much more expensive.]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777797 777797 Wed, 25 Nov 2009 17:40:07 -0500 http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777532 777532 Wed, 25 Nov 2009 14:48:03 -0500
Well said. While we can do without the newest iPhone, HD-TV, or Honda, there are commodities that we have to compete with other nations to buy, nations with sounder currencies:

* Petroleum
* Grain
* Coal
* Copper

If there is a run on the dollar, and I personally believe that such a run WILL occur, the above commodities and their byproducts will become much more expensive.]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777516 777516 Wed, 25 Nov 2009 14:35:45 -0500 http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777421 777421 The stable dollar was not the cause of America's growth and ascent > to global hyperpower status. It was a consequence. > It was the manifestation of American exceptionalism based in liberty > and a profound sense of mission...the mission of global inclusiveness > into the blessings of freedom so abundantly bestowed on America. > Free markets, free elections, free speech, free thought and the freedom > to experiment and innovate and the freedom to succeed and fail. > > A deeply Middle Class nation, America embodied traditional middle > class virtues and values and the dollar was the projection of these > virtues and values. > > The dollar was a symbol of honor because during its great ascent > America was an honorable Nation that believed in getting by giving, > in working and producing, saving and investing. The dollar was sound > because the middle class was strong and America was sound. > Now the middle class is enervated and weakening by the day. The occupation > Regime that now rules the USA has contempt for American traditions > and legacy values; it dishonors America's history and mocks its Constitution; > it despises the productive middle class. > > The dollar is now horribly disfigured and debased because America > itself has been degraded by the Regime. As the middle class falls, > so America falls. The dollar reflects this descent. The dollar is > no longer sound because occupied America is no longer sound. The > economic calamity that is impending and is prefigured by the dollar's > descent into shame is the logical consequence of the moral and intellectual > calamities that are already being inflicted on America. > > When America is re-liberated and the occupation ends, then there > will be a new America, a renewed and expanded middle class and a > new dollar that will again be an honorable store of value and medium > of exchange.]]> Wed, 25 Nov 2009 13:40:20 -0500

On Nov 25 08:05 AM User 353732 wrote:

> The stable dollar was not the cause of America's growth and ascent
> to global hyperpower status. It was a consequence.
> It was the manifestation of American exceptionalism based in liberty
> and a profound sense of mission...the mission of global inclusiveness
> into the blessings of freedom so abundantly bestowed on America.
> Free markets, free elections, free speech, free thought and the freedom
> to experiment and innovate and the freedom to succeed and fail.
>
> A deeply Middle Class nation, America embodied traditional middle
> class virtues and values and the dollar was the projection of these
> virtues and values.
>
> The dollar was a symbol of honor because during its great ascent
> America was an honorable Nation that believed in getting by giving,
> in working and producing, saving and investing. The dollar was sound
> because the middle class was strong and America was sound.
> Now the middle class is enervated and weakening by the day. The occupation
> Regime that now rules the USA has contempt for American traditions
> and legacy values; it dishonors America's history and mocks its Constitution;
> it despises the productive middle class.
>
> The dollar is now horribly disfigured and debased because America
> itself has been degraded by the Regime. As the middle class falls,
> so America falls. The dollar reflects this descent. The dollar is
> no longer sound because occupied America is no longer sound. The
> economic calamity that is impending and is prefigured by the dollar's
> descent into shame is the logical consequence of the moral and intellectual
> calamities that are already being inflicted on America.
>
> When America is re-liberated and the occupation ends, then there
> will be a new America, a renewed and expanded middle class and a
> new dollar that will again be an honorable store of value and medium
> of exchange.]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777380 777380 Wed, 25 Nov 2009 13:16:54 -0500
That leaves 33% for homes, cars, bars and everything else.

People have no concept of the complete ramifications of our predicament.

Now we are adding another 1 trillion dollar health reform bill.

The absolute, astounding, blind direction the US is heading is profound.

Its like a deafening wave coming to shore that no one wants to hear, see or smell.

The fact that our "YES WE CAN " man is blind and utterly ignorant to this concept speaks volumes. I was all on board with the mainstream "lets change America" at the beginning. Now its plain it was a marketing "crock" of more of the same.

WHAT HAS CHANGED? WHAT IS ON THE HORIZON TO CHANGE?

This is serious folks. ]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777346 777346 Wed, 25 Nov 2009 12:58:48 -0500 http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777197 777197 Wed, 25 Nov 2009 11:29:00 -0500
It is more likely that another world meeting, like 1944, will have to meet.]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777182 777182 The U.S, China, and the EU are applying a policy of 'graceful degradation' > towards the USD. > And what could the arrangement be so everyone toes their line? Maybe > Bernanke and Geitner agreed that the USD shall no longer be the world > reserve currency in a decade, favoring SDRs, if China and the EU > followed the proposal. > > But the point is that the situation must degrade gracefully. > > And yes I'm wearing a tin foil hat as I write this. OK, and what’s so hard about seeing the “carbon credit” being the New International Trade Unit? It’s precisely what’s being promoted as a “logical” solution that will unite oil / energy consumption with currency / monetary usage (think old fashioned oil / gold meet GS proprietary trading software), and will be administered in an ether environment. This isn’t being done in some backroom, but is openly advocated in our government funded educational / indoctrination facilities and has always been on the agenda of these bankers without borders. They won’t even need to bother with pesky cellulose / silk / ink instruments. What will be required, (in addition to the destruction of the freedom loving, albeit aging, US sovereign citizenry), however will be heat guns, sniffers and willing accomplices to assure no human being releases more than the predetermined calculated allotment of emissions these authorities deem acceptable. > And yes I'm wearing a tin foil hat as I write this. ]]> Wed, 25 Nov 2009 11:17:38 -0500
> The U.S, China, and the EU are applying a policy of 'graceful degradation'
> towards the USD.
> And what could the arrangement be so everyone toes their line? Maybe
> Bernanke and Geitner agreed that the USD shall no longer be the world
> reserve currency in a decade, favoring SDRs, if China and the EU
> followed the proposal.
>
> But the point is that the situation must degrade gracefully.
>
> And yes I'm wearing a tin foil hat as I write this.


OK, and what’s so hard about seeing the “carbon credit” being the New International Trade Unit? It’s precisely what’s being promoted as a “logical” solution that will unite oil / energy consumption with currency / monetary usage (think old fashioned oil / gold meet GS proprietary trading software), and will be administered in an ether environment. This isn’t being done in some backroom, but is openly advocated in our government funded educational / indoctrination facilities and has always been on the agenda of these bankers without borders. They won’t even need to bother with pesky cellulose / silk / ink instruments. What will be required, (in addition to the destruction of the freedom loving, albeit aging, US sovereign citizenry), however will be heat guns, sniffers and willing accomplices to assure no human being releases more than the predetermined calculated allotment of emissions these authorities deem acceptable.

> And yes I'm wearing a tin foil hat as I write this.
]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777151 777151 Wed, 25 Nov 2009 11:02:49 -0500
Like that bruised boxer with both eyes swollen shut and blood gushing from his head, he keeps motioning for more - keeps refusing to go down, and the ref is being paid quite nicely to not end the fight under any circumstance.

It looks valiant, and maybe just maybe he can make it to the last bell and get the judges to crown him the winner.

Its not going to happen that way, and maybe it takes his lungs to collapse or the light to fall from the scaffold and strike him dead, but in the end he's dead man walking and the longer the ref lets the fight go on, the less chance he has to survive and fight another day.]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777119 777119 Wed, 25 Nov 2009 10:42:20 -0500
I don't think the general public appreciates, yet, the enormity of the situation. $100 trillion dollars is equivalent to over a quarter of a million dollars of debt for every man woman and child. For an average family of four, that is more than a million dollars of debt per household....present value!!! And for every year we run a deficit, we add an equal amount to the unfunded liabilities.

Needless to say, a reduction in the standard and quality of living is an understatement. Bottom line is, our sick and elderly loved ones are going to die prematurely..... and that's simply unacceptable.

The destruction in our standard of living will ultimately manifest itself in the form of significantly higher taxes and the addition of a multitude of user fees. At current debt levels (including the unfunded), you can consider this new reality to be permanent. This change will likely put the US at the top of the list of the highest taxed nations in the world. The sad part is, most of the current high-taxed nations have a decent health care system. We will be at the top of the list with a crippled health care system.

Has anyone ever considered that there will be a mass exodus of our mosted talented and highly contributing pool of workers (and businesses)? This will be especially true if Obama continues to push his socialist agenda.

I gotta say, Canada is starting to look mighty sweet right now... I don't care how bad their hockey teams are...]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-777110 777110 Wed, 25 Nov 2009 10:39:42 -0500
]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-776934 776934 The stable dollar was not the cause of America's growth and ascent > to global hyperpower status. It was a consequence. > It was the manifestation of American exceptionalism based in liberty > and a profound sense of mission...the mission of global inclusiveness > into the blessings of freedom so abundantly bestowed on America. > Free markets, free elections, free speech, free thought and the freedom > to experiment and innovate and the freedom to succeed and fail. > > A deeply Middle Class nation, America embodied traditional middle > class virtues and values and the dollar was the projection of these > virtues and values. > > The dollar was a symbol of honor because during its great ascent > America was an honorable Nation that believed in getting by giving, > in working and producing, saving and investing. The dollar was sound > because the middle class was strong and America was sound. > Now the middle class is enervated and weakening by the day. The occupation > Regime that now rules the USA has contempt for American traditions > and legacy values; it dishonors America's history and mocks its Constitution; > it despises the productive middle class. > > The dollar is now horribly disfigured and debased because America > itself has been degraded by the Regime. As the middle class falls, > so America falls. The dollar reflects this descent. The dollar is > no longer sound because occupied America is no longer sound. The > economic calamity that is impending and is prefigured by the dollar's > descent into shame is the logical consequence of the moral and intellectual > calamities that are already being inflicted on America. > > When America is re-liberated and the occupation ends, then there > will be a new America, a renewed and expanded middle class and a > new dollar that will again be an honorable store of value and medium > of exchange.]]> Wed, 25 Nov 2009 09:14:52 -0500
Cause and effect is so important, and so easily reversed by the Regime...

They use this trick constantly.




On Nov 25 08:05 AM User 353732 wrote:

> The stable dollar was not the cause of America's growth and ascent
> to global hyperpower status. It was a consequence.
> It was the manifestation of American exceptionalism based in liberty
> and a profound sense of mission...the mission of global inclusiveness
> into the blessings of freedom so abundantly bestowed on America.
> Free markets, free elections, free speech, free thought and the freedom
> to experiment and innovate and the freedom to succeed and fail.
>
> A deeply Middle Class nation, America embodied traditional middle
> class virtues and values and the dollar was the projection of these
> virtues and values.
>
> The dollar was a symbol of honor because during its great ascent
> America was an honorable Nation that believed in getting by giving,
> in working and producing, saving and investing. The dollar was sound
> because the middle class was strong and America was sound.
> Now the middle class is enervated and weakening by the day. The occupation
> Regime that now rules the USA has contempt for American traditions
> and legacy values; it dishonors America's history and mocks its Constitution;
> it despises the productive middle class.
>
> The dollar is now horribly disfigured and debased because America
> itself has been degraded by the Regime. As the middle class falls,
> so America falls. The dollar reflects this descent. The dollar is
> no longer sound because occupied America is no longer sound. The
> economic calamity that is impending and is prefigured by the dollar's
> descent into shame is the logical consequence of the moral and intellectual
> calamities that are already being inflicted on America.
>
> When America is re-liberated and the occupation ends, then there
> will be a new America, a renewed and expanded middle class and a
> new dollar that will again be an honorable store of value and medium
> of exchange.]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-776797 776797 Wed, 25 Nov 2009 08:48:05 -0500
Traditionally, nations use manufacturing / exports to earn foreign exchange. As American manufacturing declined (was murdered?) the need arose to maintain dollar hegemony so that the new American welfare/warfare global empire could continue to grow.

In other words, the need to use IRS to manage the value of the USD arose concurrently with the decline in American manufacturing. IRS were the weapon of choice; they now total some $200 Trillion. Now, many will come and tell you that IRS are 'neutral' and that they net to zero and so they're they financial equivalent of cute puppies. Even the IMF claims that global IRS net to zero, so they make no effort to acount for them in their global financial report. See www.imf.org/External/P..., page 63, and I quote the report here directly:

'Caveats to the Application of Estimated Security Loss Rates to Bank Holdings

Our approach for estimating mark-to-market losses on securities includes only cash instruments, and thus does not account for potential leveraged exposures. As in other iterations, we assumed that derivatives exposures net out to zero for the system as a whole. We did not account for concentrations of counterparty risk.'

Nothing to see here, move along.

The simple truth is that derivatives enable leverage through the mechanism of lying about ratings (while simultaneously earning cash flow to those who suborn the lies). And of course the counterparty risk is concentrated, among the five major banks in the US Treasury's OCC derivative report. Why else could they be 'too big to fail'?

So Greenspan's 'Great Moderation' was a lie, nothing more than smoke-and-mirrors manipulation of currency valuations. Maestro my aching butt; more like a criminal traitor.

User 353732: I agree, we are occupied by an oligarchy, and nothing will get better until that is remedied. The truth shall set us free.]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-776670 776670 Wed, 25 Nov 2009 08:26:25 -0500 http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-776655 776655 Wed, 25 Nov 2009 08:24:20 -0500 Perhaps Washington is betting it is enough of an 800-pound gorilla, internationally as it is domestically, that it can impose a continuation of the current unreality that benefits now only the winners in the present status quo because change will be wrenching and difficult.
Perhaps their idea is that if we fake it until we make it with mark to magic accounting, this entitled insider's system will somehow pan out, for at least some years.
Since it has brought record indebtedness during the last "recovery" and each depends more on suspension of disbelief, for the rest of us, another "recovery" of the system with present insiders in place will not even look like a recovery. The entitled, the rent-seekers who benefit, are betting they can impose their whims on us and the world, no matter how far-fetched and utterly corrupt they've become. Clearly, interest rates will rise, and this unreformed, unrepentant house of cards of the entitled cannot withstand that shock.]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-776619 776619 Wed, 25 Nov 2009 08:05:11 -0500 It was the manifestation of American exceptionalism based in liberty and a profound sense of mission...the mission of global inclusiveness into the blessings of freedom so abundantly bestowed on America. Free markets, free elections, free speech, free thought and the freedom to experiment and innovate and the freedom to succeed and fail.
A deeply Middle Class nation, America embodied traditional middle class virtues and values and the dollar was the projection of these virtues and values.

The dollar was a symbol of honor because during its great ascent America was an honorable Nation that believed in getting by giving, in working and producing, saving and investing. The dollar was sound because the middle class was strong and America was sound.
Now the middle class is enervated and weakening by the day. The occupation Regime that now rules the USA has contempt for American traditions and legacy values; it dishonors America's history and mocks its Constitution; it despises the productive middle class.

The dollar is now horribly disfigured and debased because America itself has been degraded by the Regime. As the middle class falls, so America falls. The dollar reflects this descent. The dollar is no longer sound because occupied America is no longer sound. The economic calamity that is impending and is prefigured by the dollar's descent into shame is the logical consequence of the moral and intellectual calamities that are already being inflicted on America.

When America is re-liberated and the occupation ends, then there will be a new America, a renewed and expanded middle class and a new dollar that will again be an honorable store of value and medium of exchange.


]]> http://seekingalpha.com/article/175264-the-case-for-depression-part-4-dollar-collapse?source=feed#comment-776614 776614 Wed, 25 Nov 2009 07:59:28 -0500
The U.S.-China trade imbalance is unsustainable, and permitted U.S consumers to accumulate more debt than they otherwise would have, if the USD wasn't the reserve currency of the world [see Triffin dilemma]

en.wikipedia.org/wiki/...

Moreover, 75% of the US economy is consumer based, while China is largely export based. Another unsustainable situation, which will be rectified with a graceful degradation policy. So we're likely in a period where the Fed will gracefully depreciate the USD, allowing the manufacturing sector to compete more competively, and grow in terms of the % of GDP.

I'm assuming China will attempt to boost domestic demand. And the EU--well it'll have to wait it out.

And what could the arrangement be so everyone toes their line? Maybe Bernanke and Geitner agreed that the USD shall no longer be the world reserve currency in a decade, favoring SDRs, if China and the EU followed the proposal.

But the point is that the situation must degrade gracefully.

And yes I'm wearing a tin foil hat as I write this.]]> http://seekingalpha.com/article/159647-prepare-for-a-lower-dow-to-gold-ratio?source=feed#comment-661229 661229 see Kim, there has been so many bullishness in gold, that it is just > an excellent short at current 976 . gold is buliish because: > - september is just excellent > - dow/gold ratio is going to 1 > - stock markets are gonna fall (i.e. people will rush to safety - > gold) > - money printing, and such blah blah blah > Nobody actually sees that gold has now 3 attempts to break 1000 and > it couldn't. It makes lower lows on every attempt. Moving DOW/GOLD > averages are pushing higher and treaten to do a golden crossover. > I was expecting it to reverse at 9, but it now at 10. Gold at this > time (technically) is a sell signal. Yeah, gold is going into a nasty > bear market for 2 years, to bottom around 500. The trend should start > on london close on thursday with following big selloff on friday > 4 sep somewhere to 920-930.]]> Thu, 03 Sep 2009 22:23:49 -0400 1. Central banks around the world start shorting gold to scare investors.
2. Central banks worldwide, including IMF, are ready to quietly dump out gold to push down the price.
3. Central banks around the world collect gold mining stocks during each pullback, then start selling them off to depress stock prices whenever gold hovers in the high 900's.

This is a blatant attempt to manipulate the markets, especially in the U.S. The Fed and Treasury are soiling their britches each day that gold starts a run. They throw themselves at it like it was the last 100 yards of the marathon - it may be - that will only work so many times before gold breaks out, and then, Katie bar the door. I expect it will run all the way to 1300 and then slowly slide down to 1100. Following that it will likely start a slow, steady climb that no one can stop until...??? I guess we'll see what the velocity of money looks like next spring. For the fall and summer it's about to be naptime, with the market having priced in all the expected inflation for the next year. Sweet dreams.


On Sep 02 03:12 PM ker.nulov@gmail.com wrote:

> see Kim, there has been so many bullishness in gold, that it is just
> an excellent short at current 976 . gold is buliish because:
> - september is just excellent
> - dow/gold ratio is going to 1
> - stock markets are gonna fall (i.e. people will rush to safety -
> gold)
> - money printing, and such blah blah blah
> Nobody actually sees that gold has now 3 attempts to break 1000 and
> it couldn't. It makes lower lows on every attempt. Moving DOW/GOLD
> averages are pushing higher and treaten to do a golden crossover.
> I was expecting it to reverse at 9, but it now at 10. Gold at this
> time (technically) is a sell signal. Yeah, gold is going into a nasty
> bear market for 2 years, to bottom around 500. The trend should start
> on london close on thursday with following big selloff on friday
> 4 sep somewhere to 920-930.]]> http://seekingalpha.com/article/159647-prepare-for-a-lower-dow-to-gold-ratio?source=feed#comment-660790 660790 I have a question. Why is it compared to the DOW. Is there any credence > to using the S&P 500 or Russell 3000. (maybe Wilshire 5k) > > I would be interested in the authors thoughts]]> Thu, 03 Sep 2009 15:54:29 -0400
The S&P would work just as well, if not better, in my opinion. However, the S&P has only been around since 1957, so it's hard to extrapolate from historical data in the same way that you can with the Dow.


On Sep 03 12:06 PM granger wrote:

> I have a question. Why is it compared to the DOW. Is there any credence
> to using the S&P 500 or Russell 3000. (maybe Wilshire 5k)
>
> I would be interested in the authors thoughts]]> http://seekingalpha.com/article/159647-prepare-for-a-lower-dow-to-gold-ratio?source=feed#comment-660420 660420 Thu, 03 Sep 2009 12:06:32 -0400
I would be interested in the authors thoughts
]]> http://seekingalpha.com/article/159647-prepare-for-a-lower-dow-to-gold-ratio?source=feed#comment-660315 660315 Thu, 03 Sep 2009 11:05:44 -0400 http://seekingalpha.com/article/159647-prepare-for-a-lower-dow-to-gold-ratio?source=feed#comment-660307 660307 Thu, 03 Sep 2009 11:01:44 -0400 http://seekingalpha.com/article/159647-prepare-for-a-lower-dow-to-gold-ratio?source=feed#comment-659324 659324 Wed, 02 Sep 2009 19:25:42 -0400
There is certainly a tipping point where investors will lose confidence in the ability of the US government to replay debt, especially during high rates of deflation, and opt for an alternative medium of exchange vs. the dollar. In the next few years IMO gold will fill this void until the world economy recovers and a risk averse fiat currency appears.

Disclosure: 10% gold bullion position & 1% gold equity position]]> http://seekingalpha.com/article/159647-prepare-for-a-lower-dow-to-gold-ratio?source=feed#comment-659026 659026 Wed, 02 Sep 2009 16:24:46 -0400