Asbytec

The Bernanke Dollar Call?

Morph, China is fearing for it's productive survival. They will have to inflate harder to devalue their currency against a falling dollar even as current account deficits improve and China's exports are down 26%(?) This is a protectionist proposal coming from a command economy. No one will take it seriously. The dollar is not dead, yet.

Ever wonder why they offer contradictory policies of buying more US bonds while calling for a new global reserve currency? Strange.

The Bernanke Dollar Call?

One of the major woes debasing the dollar is our current account balance, which will continue to improve through the year and into next. Don't write the dollar off, yet. All currencies are distressed.

The Bernanke Dollar Call?

Thank you for the chart on deflation. Interesting and scarey.

I believe the ECB will eventually come to terms with QE and near zero interest rates, especially as the dollar index falls.

China, too, will most likely buy bonds instead of US products to keep it's currency pegged to a falling dollar.

The currency wars are underway. The dollar will survive. And inflation will be upon us in time.

Rescuing the U.S. Dollar

Yep. Keep the credit markets open so we can continue to spend. We can get deeper into debt by borrowing our own tax dollars. What's left? Our productive assets, our homes, and our gold are all pawned off.

Rescuing the U.S. Dollar

Well, it's mute now. The bail out, er, I mean buy in plan failed. We're in uncharted waters. We've been there before. There's rocks on the shore.

If there were some way to let the banks fail and survive, I would vote for that. It was credit that got us in trouble. Remember the plethora of credit cards we all got in the mail?

It seems kind of strange congress and Paulson wanted to give the banks our money so they could in turn lend it back to us so we can get deeper into debt...keeping the debt economy flowing.

Why don't we just give each American half a million dollars and let them pay off their homes? Let the money trickle up for a change. There's an email going around to that effect and it's beginning to make sense.

As for what it means for the dollar? Your guess is as good as any. But we need to take it in context. Europe is in trouble, too. So, let's see what happens to the troubled euro and pound.

But, yes, the massive derivative market has inflated the dollar beyond Fed control.