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Strategies & Market Trends : The coming US dollar crisis

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To: Giordano Bruno who wrote (5384)3/23/2008 11:55:28 AM
From: Tommaso  Read Replies (2) of 71456
 
Inflation in China is not as bad as in Saudi Arabia, but in both cases the currencies are being held back by the governments from a natural tendency to appreciate. I say "natural" meaning that the classic effect of a positive balance of payments is to make a currency worth more.

I can't keep enough of the entire process in mind to reason through all the steps, but generally speaking, it looks as if these countries may be forced to allow appreciation, and this will force (or export, if you like) inflation on the United States. The situation also ought to have a powerful upward push on the price of gold.

Maybe Vi can articulate this better than I can.
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