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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Hawkmoon who wrote (15297)	1/1/2002 7:30:25 PM
From: 49thMIMOMander	Respond to of 281500

<Arab obsession with gold> Where do you get everything from??

To: Hawkmoon who wrote (15297)	1/2/2002 12:23:52 AM
From: Maurice Winn	Read Replies (1) \| Respond to of 281500

Hawk, I'm with you on the US$. I believe that the alleged overvaluation of the dollar is not recognizing the intangible values which the dollar offers. People are prepared to accept worse returns on dollars than other currencies because of risk in the other currencies, the long-term political and economic stability of the USA and all the infinite array of variables which surround a currency. Money is a measuring stick. I don't believe the US$ is in a bubble zone. It is simply a very powerful currency and with good cause. Even though a hamburger costs a bunch of NZ$ in the USA, it doesn't mean the money will flow quickly downhill to NZ, though the bigger the drop, as with voltage, the greater the flow. Americans can come here and laugh at the prices they have to pay. So they tend to spend. But the power of the US$ can carry a big voltage difference between the USA and Japan, Europe, Australasia, China, India and a lot more besides without having it drain out quickly. People predict a balance of trade and deficit problem year in year out. But they are disappointed year after year. My point is that the US$ is not going to be beaten by any other national currency or combined national currencies such as the Euro. I say it's going to be replaced by a new cyber-currency. That will take time. 3G wireless is still only getting warmed up and cybermoney won't even get started until 3G is roaring. So, US$ is a reasonable bet for another few years yet. And then it will perhaps be a gradual transition. Perhaps very manageable. But, with dawning realization of change in value, markets can be very lumpy - as shown by the dot.bomb and tech.wreck - and can change very quickly as everyone runs for the door, not wanting to be left holding the hot potato. A twenty year Treasury Bond is a long-term commitment in such circumstances. A spot of panic could set in. 30 years for a Treasury Bond is longer than forever the way the world is going. Inflation could become quite a big event in a few years as people abandon the US$, Euro, Yen, Rupee, Shekel, Real, Oz and Hobbit for cyberspace. If Jay is right, there could be a three year US$ crash as values are recognized, which might take us through to Q time. Mqurice