<you don't believe this speculative boom in commodities will last more than a few months>
I'm not sure exactly how it plays out. It could be very sharp and brief: a tornado, or it might come in stages like a hurricane, the front wall may just destroy everything, or it might be a glancing blow, with the eye coming over for some respite, with the coup de grace being the back wall. Hard to say. I think there will be warnings for those paying attention, there are plenty now.
<to what extent does the weakness or strength of the US Dollar play a part?>
Very important, the weaker the USD the worse the intensity will be, and vice versa. I don't think the USD can be talked up though. Nor do I think "turning off electricity and denying permits" will have much effect in China. And the BOJ trying to artifically prop the USD (*), just adds more monetary fuel to the inflation. BOJ intervention is very pro-Train Wreck, and is especially pro-Crack-up Boom.
The detox for it would be a currency defense (defense of money: from all three symbiotic players) that doesn't involve printing more dollars (or yen or yuan). The traditional monetary tools being applied, will of course have the opposite effect of their intent . You could see that today when the Fed fiddled with words, while Rome burns, just another spike up in various commodities and input prices. Food especially is really going nuts right now.
(*) I wonder if the Japanese haven't wrecked the yen as money already, that they can sink to the bottom together with the USD in a monetary melt-down, no need to intervene anymore. |
