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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: energyplay who wrote (55649)	11/6/2004 5:42:45 AM
From: Seeker of Truth	Read Replies (1) \| Respond to of 74559

EP, The problem is: none of the causes of the drop in the US dollar in the last 2 years has been addressed. The fall itself has not resulted in any noticeable decrease in the balance of payments. Also about living in a cave, it seems this cave is shared by the governments of China and Japan, huge banks and insurance companies of Europe, central banks in Europe who are still selling gold, etc. Everybody seems to judge that they are best off doing what they are doing, getting in return employment(China), profits for exporters(Japan) the "inevitable" turn around and ascent of the US dollar(Europeans). As for US investors, a fall in the US dollar means nothing to their minds, only a healthy influence. It is said that trade balances take a year or so to react fully to changes in currency valuations. But so far, any correction is invisible. The Europeans I talk to dislike US policies but are awestruck by what they consider a much more dynamic economy than theirs. So an investment in the US is not considered madness by them. My own guess is that absent US-scale military expenses, the non Russian part of Europe will have a stronger economy than the US for some longish period. At some point the myth of US economic power and wisdom(Greenspan!!!) will pass away.