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Monday, December 28 2009 |
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- The macro economic conditions that preceded the Argentinian collapse in 2001 - when foreign investors lost confidence in the government and refused to roll over short-term bonds - are astonishingly similar to the U.S. today.
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This news story has 17 comments:
Ok, similar, save one absolutely over-the-top critical point -- Argentina is not the United States. The US Dollar is the worlds reserve currency, and until proven otherwise, the US is the leading "safe-haven" during times of economic trouble for people the world over. This was conclusively demonstrated 4 months ago when people thought the world was going to implode, and Treasuries performed incredibly.
Otherwise, yes, conditions are identical. Do you really think the results will be?
Always been that way. Always will.
History doesn't repeat, but it sure as hell rhymes. iTulip was disturbing accurate in predicting what has occurred thus far and I follow their commentary very *very* closely.
Disclaimer: I subscribe to iTulip.
However, what should really shake people up is the admission by the author(s) that they have been "too optimistic" every step of the way, in the early parts of the U.S. economic collapse.
On Jun 28 07:22 PM The Geoffster wrote:
> The dollar's demise is certain, but not in our lifetimes. Not only
> is the dollar the only currency that can serve as the world's reserve
> currency, the U.S. economy dwarfs all others, even in depression.
> The U.S. remains the only superpower and yes, the world depends on
> our leadership. Having said all that, our day in the sun is passing,
> as it must. China, India and Brazil loom on the horizon, but worst
> case scenario, The U.S. will be first among equals.
On Jun 28 07:55 PM Market Sniper wrote:
> Hate to disagree. Think ALL fiats are doomed and in fairly short
> time frames from this point. Was disucssing it with a friend of mine
> the other day. IF all the fiat curencies devalue at the same rate,
> will the USDX still be around 80 when they ALL hit zero at the same
> time?
So far, I've limited most of my hedging to Short ETFs (SKF, FAZ, SRS) and several Commodity ETF Longs. But I am becoming less certain that any of they will perform as designed, mainy because of the continued gov.t-directed manipulation.
I remain torn about investing in physical gold...because I believe that if things get really bad, the US Gov will confiscate it or simply implement a special sales tax on gold sales...eliminating any profit the personal holders might have otherwise have received when divesting of gold they bought.
With all the push for Cap and Trade and anti-shorting that this government wants to force on us, I would not put it past them to dream up a cap and trade for gold, too.
Investing, today, is like a visit in Wonderland. Red is Blue. Up is down based on whatever law du jur the Kenyan in office wants to foist on us. I would welcome your insights on these or other hedging options that you believe are worth some further research/due dilligence.
Respectfully,
SteadfastMason
On Jun 28 08:13 PM The Geoffster wrote:
> Isn't that what happened in the 30s, beggar thy neighbor? Switzerland
> just devalued. I'm hedged against collapse and if it happens sooner
> rather than later, I'll do fine. Still, as pessimistic as I am, I
> wouldn't count us out. We've got the military industrial complex.
>
On Jun 28 09:24 PM SteadfastMason wrote:
> How are you hedging?
>
> So far, I've limited most of my hedging to Short ETFs (SKF, FAZ,
> SRS) and several Commodity ETF Longs. But I am becoming less certain
> that any of they will perform as designed, mainy because of the continued
> gov.t-directed manipulation.
>
> I remain torn about investing in physical gold...because I believe
> that if things get really bad, the US Gov will confiscate it or simply
> implement a special sales tax on gold sales...eliminating any profit
> the personal holders might have otherwise have received when divesting
> of gold they bought.
>
> With all the push for Cap and Trade and anti-shorting that this government
> wants to force on us, I would not put it past them to dream up a
> cap and trade for gold, too.
>
> Investing, today, is like a visit in Wonderland. Red is Blue. Up
> is down based on whatever law du jur the Kenyan in office wants to
> foist on us. I would welcome your insights on these or other hedging
> options that you believe are worth some further research/due dilligence.
>
>
> Respectfully,
>
> SteadfastMason
>
>
SteadfastMason wrote:
> How are you hedging?
>
> So far, I've limited most of my hedging to Short ETFs (SKF, FAZ,
> SRS) and several Commodity ETF Longs. But I am becoming less certain
> that any of they will perform as designed, mainy because of the continued
> gov.t-directed manipulation.
>
> I remain torn about investing in physical gold...because I believe
> that if things get really bad, the US Gov will confiscate it or simply
> implement a special sales tax on gold sales...eliminating any profit
> the personal holders might have otherwise have received when divesting
> of gold they bought.
>
> With all the push for Cap and Trade and anti-shorting that this government
> wants to force on us, I would not put it past them to dream up a
> cap and trade for gold, too.
>
> Investing, today, is like a visit in Wonderland. Red is Blue. Up
> is down based on whatever law du jur the Kenyan in office wants to
> foist on us. I would welcome your insights on these or other hedging
> options that you believe are worth some further research/due dilligence.
>
>
> Respectfully,
>
> SteadfastMason
>
>
Lucky for us most people don't know this.
The Argentines are mere pikers.
"Indeed, what the United States owes to foreign countries it pays- at least in part- with dollars that it can simply issue if it chooses to."
Charles de Gaulle, 1965- prior to unilaterally unraveling BW
On Jun 28 09:55 PM shrike wrote:
> That fiat currency everyone is so bearish on costs nothing to produce
> and is traded for massive amounts of valuable raw materials from
> other countries. Its the greatest racket in the history of the world
> - even better than Rome's tax collectors dispersed all over the Old
> World. We don't even have to collect - they send their commodities
> to us willingly.
>
> Lucky for us most people don't know this.
>
> The Argentines are mere pikers.
Believing that the US reserve currency status is sacrosanct is just more of the bubble mentality that got us into this trouble in the first place. Bubbles occur when people believe that the good times will continue for no other reason than that the good times have continued thus far. Then suddenly the bubble bursts and people act all surprised when any look at the fundamentals would have shown that it couldn't continue. Tech stocks couldn't continue growing when companies with just an idea and 5 employees were valued at more than companies making billions of dollars in profits. Housing couldn't continue rising at those rates when incomes were falling. The US cannot continue indefinitely its reserve currency status when it has skyrocketing debts AND deficits, and free-falling incomes. Banks and others that loaned GM money eventually got to the point where they had to decide if they should just cut their losses and allow bankruptcy to happen or put up more money and hope for a turn around. In the end they decided to cut their losses and there's no reason that the same cannot happen between the US and its creditors.
On Jun 28 06:38 PM themackattack wrote:
>
> Ok, similar, save one absolutely over-the-top critical point -- Argentina
> is not the United States. The US Dollar is the worlds reserve currency,
> and until proven otherwise, the US is the leading "safe-haven" during
> times of economic trouble for people the world over. This was conclusively
> demonstrated 4 months ago when people thought the world was going
> to implode, and Treasuries performed incredibly.
>
> Otherwise, yes, conditions are identical. Do you really think the
> results will be?
The US won't ever default because it can always print enough dollars to pay debts denominated in US dollars, but it can drop precipitously against other currencies. As the dollar drops the prices of those commodities and other imports will rise. And maybe this is just temporary but the US dollar has been losing value against most major currencies every month since February. China is the exception and they've been holding their currency steady against the dollar. Since 2000 the Euro has gained over 40% against the dollar. The dollar has been becoming progressively weaker and I believe this trend will continue for the foreseeable future.
On Jun 28 09:55 PM shrike wrote:
> That fiat currency everyone is so bearish on costs nothing to produce
> and is traded for massive amounts of valuable raw materials from
> other countries. Its the greatest racket in the history of the world
> - even better than Rome's tax collectors dispersed all over the Old
> World. We don't even have to collect - they send their commodities
> to us willingly.
>
> Lucky for us most people don't know this.
>
> The Argentines are mere pikers.
On Jun 28 09:49 PM The Geoffster wrote:
> GDX, GLD, SLV, CEF, TBT. I've had mixed results with SRS but I'll
> get back in @ 20. I also trade in and out of DBA and MOO. I also
> own paladium. I like PHO for the water play. Paper assets are iffy
> so watch carefully and be ready to bail early if things look like
> they're going nuts. Physical gold and silver can't be confiscated.
> Nobody has to know you have it until you need it, in which case,
> be heavily armed. If you have the means, buy farm land.
>
> SteadfastMason wrote: