ezrasfund

Are Uncle Sam's Creditors Heading Towards the Exits?

Swiss Franc


On Jan 22 10:37 AM Chris B wrote:

> If foreign investors stop buying treasuries, the government will
> resort to money-printing to fund itself. This would devalue the
> currency, so this possibility suggests that US and foreign investors
> should be diversifying out of the dollar.
>
> But what currency should we go into? The British pound is even worse
> off, and Willem Buiter has suggested that it could go the route of
> Iceland's currency. Both the Euro and the Yen seem unattractive
> due to debt/GDP ratios that are far beyond even the US's levels and
> demographic graying. The Canadian and Australian dollars seem to
> track commodity prices more than fiscal policy or obtainable yields,
> so you might as well be buying commodities. The Chinese yuan is
> issued by a communist export country that has an interest in keeping
> its value down. India has chronic inflation. Commodities such as
> precious metals and oil are volatile gambles on future inflationary
> sentiments, and don't really fit the definition of a safer investment
> than the USD as their fluctuations are far greater than the dollar's.
> What's left?

A New Bull Market Is Born

TA tries to predict short term "noise" in the market.

FA predicts long term trends.

Short term might well be up...

Long term will probably be down...

Longest term markets will rise, inflation will return, we'll all be dead.

Fear of Higher Taxes a Cause of Sell-off

What about the phantom Bush tax increase which will some day be paid? Or not.

If I charge $1000 on may credit card instead of paying cash is that not money that will have to be paid? In the aggregate goverment spending and taxes will have come into balance. Will the "great deleveraging" ever extend past Fannie and Freddie all the way to the US Treasury? And will the US pay up or default? Finally the banks can't grow their way out of their leveraged positions. Will the US government be able to grow its' way out of high debt ratios forever? Including some auto company style legacy costs?

Good luck. "In the long run we'll all be dead," but does that include our government?

Financial Forecasters All Pointing Down

Everyone seems to forget to mention that gasoline and other energy products are a part of consumer spending. We're spending plenty, but it's not going to help most sectors of the economy.

Main Street Sacrificed to the Gods of Wall Street

Will the editors please block Tony S from posting the same lengthy "stuff" over and over again?

Main Street Sacrificed to the Gods of Wall Street

Not lon ago CNBC pundits were listening mouths agape as T Boone predicted $100 oil. Now they are chortling that oil has plunged to $99. Just how long has it been?