Z., I understand what Sachs means. Based on his other analyses, however, what he eschews is often too empirical. Or at least that's the way I recall them. To posit ideas and opinions in such a manner might make an analysis more convincing, but it often fails to tell the whole story. Not that I'm picking on Mr. Sachs, others do it as well.
What is the alternative right now for Argentina, but to remain 1 peso : 1 dollar?
My opinion, overall, is that the rapid growth policy pursued by U.S. monetary authorities, and many fiscal proponents as well, is a major risk element for those that have tied themselves to the dollar. I know that's a rather "plain Jane" statement, but I'll have to leave it at that. If we have a substantial slowing in the U.S. economy, some of the hazard in USD-pegging will be reduced. I think you, Z., may have also indicated as much.
There remain, in any case, risks that prevent us individual investors from entering many foreign markets with any force. Wish it weren't the way, because I'd like to take some larger positions. I just can't see it right now. Which is also why I posted the Der Spiegel summary,...as a reminder.
There has been talk recently of the EU upping the % of gold behind the Euro. I think that is an excellent move. But, then, I would probably be considered a fiscal / monetary conservative by most measures. And, as such, I can see why there are reports of dissension emanating from within the G-7. The U.S. / Britain / IMF / World Bank / Et Al are attempting to save a system that is fundamentally flawed. The consortium prefers a rapid growth engine, but the effects of global political machinations require that engine have a tamper-proof governor. The current system has no such device.
It's all about control. But that's a lengthy topic. |
