TinyTim

Is the Dollar Becoming Less Global?

Now that the bailout is trashed, it will be interesting to hear what Warren has to say.

This article is one of the few that goes to the actual reason Paulson, et al are in such a panic about wall st. It may well be the end of the deficit without tears i.e. USD loses its defacto reserve status. When the dollar is devalued to 10% like some Third World country, how embarassing for us.

Gold may be an anacronism according to Keynes, but until someone comes up with a better way to maintain bulletproof monetary-fiscal responsiblity in Congress, like a simple balanced budget, this relic should be revived.

The other reason for the panic is the preservation of the SWF's. If they ever start thinking there is a better / safer investment out there than the US, the dollar is sunk. Globalization is the great equalizer. Devaluation will bring the US economy abruptly to the true level that the Feds have been trying to hide or ease into.

So it's less about Main Street and more about The Hill.