Gary >What will finally send the US$ down?
I think we are a long, long way from that happening. Why? Because there is nothing that can take the USD down. It's not that the USD doesn't deserve to be weaker --- in fact, a lot weaker --- but there is no other currency, no other economy, that can stand against the USD and the US economy.
It's similar to the saying that, for evil to triumph, all that has to happen is for good men to do nothing. In the dollar situation I am saying that, for the dollar to fall, some other economy must rise. And, there simply isn't another economy to do that. The European economies are in real trouble and Japan is going from worse to still worse.
So, it makes no difference how much the US borrows, how big is the deficit, how much inflation or bubbles or whatever, the USD will remain strong.
Once upon a time, gold might have been the balancing factor against a weak USD but that is not going to be this time round. It will simply not be possible for the POG to rise above $320, for the foreseeable future anyway. The CRB is, of course, rising all the time but commodities cannot be considered to be a "currency".
The situation is identical to that of the US government --- it makes no difference how dishonest, tyrannical, corrupt, ruthless, biased, whatever, the government is --- no-one within or outside the US can bring it down. The only party that once might have, the Democratic Party, is kaput --- dead as a Dodo. So, unless there is a revolution, which is most unlikely, Mr Bush and his clique will rule forever.
Likewise, the USD.
And, don't be surprised if Messrs Dow & Co stage a "recovery" from here on, notwithstanding the miniscule earnings and dividends available.
Welcome to the world of "make believe" where dishonesty prevails, truth never enters, Evil triumphs and there is never a Day of Reckoning --- except for those who dare to open their mouths. |
