The coming US dollar crisis Message Board

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Strategies & Market Trends : The coming US dollar crisis

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To: gregor_us who wrote (26397)	1/22/2010 9:23:15 AM
From: ItsAllCyclical	4 Recommendations Read Replies (1) of 71475

US Dollar crash vs decline. Would you consider a move to the 40-50 area over 4-8 year period a crash? I guess I would define a crash as more of a 25%+ decline in less than 1-2 weeks. Given the problems in all the other major currencies I don't see that as very likely, but certainly possible. I agree w/everything you're saying from an FA perspective, just a question of timing and interactions. If CBs buy each other's crappy currencies with QE can't this game of extend and pretend continue a bit longer? I keep hearing Japan will have issues prior to the US. Based on the reasoning I've seen I tend to agree, but I'm no expert. If Japan does get hit first it would seem good and bad for the US from a Dollar perspective. Would they be forced to sell Dollars or would they keep them in reserve if the Dollar appreciated as a ST safe haven? Other than looking at Treasuries and the value of the Dollar what other methods will you use to determine the degree of capital flight? It would seem the Fed would try to hide this data as much as possible or obscure it. Trying to find global central bank reserves during the Great Depression. US Dollar is still very over owned. Would like to see what % the Pound Sterling and German mark represented during the early 1900's. >>Prior to World War I, the United Kingdom had one of the world's strongest economies, holding 40% of the world's overseas investments << edinformatics.com Now the pound is approx 2% of global CB reserves. Not apples to apples, but you get the idea. We're at a point w/no precedent with the Dollar still over 60% of the worlds CB reserves. The world has a vested interest to prevent a Dollar crash on the one hand, but the fact that it's so over owned also makes a crash certainly more possible. Reading further from same link... >> This was abandoned on 21 September 1931, during the Great Depression, and sterling suffered an initial devaluation of some 25% << So maybe that supports your thesis of a crash since the Dollar is certainly more precarious than the sterling at the same pts in history.

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