SW Richmond

How the U.S. Financial Crisis Resembles Japan’s 'Lost Decade' - And How to Play It, Part II

To All Gold Bashers:

Let's not confuse "commodity prices" with "dollar-denominated commodity prices." The unique aspect of the current situation is that the USD is the world's reserve currency and (currently) serves as a price gauge for oil etc. The pressure on the greenback is astronomical. Each mini-crisis we have seen (November Libor Lockup, Bear Stearns, Fannie/Freddie) have caused an observable crush of the dollar in real time until government intervened. If you are buying things will dollars, or holding assets in dollars, your future is dim, as the government is running out of ammo. USDX has been on life support since November. The coming wave of bank failures will kill it dead.

Was 70's "Stagflation" a dress rehearsal for an "Inflationary Depression"? Ask the British is they enjoyed their displacement of Sterling as the world's reserve. What events transpired during that transition?

Does the US have a unique opportunity as a technological leader? Absolutely. Will our brilliant political leaders get out of the way and let us take advantage of it? What do you think? And if it happens, who will own the companies that do it? Us? Or the SWF's?

Either the market is free, or it isn't. If decisions could be made in an environment free of regulatory cronyism we could thrive. US Government has become to large too allow genuine competition, which includes failure. A lost decade it is then.

At least.