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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: orkrious who wrote (30787)	4/17/2005 4:33:04 AM
From: Taikun	Read Replies (2) \| Respond to of 110194

Ork, It could happen overnight. I see the Tresury auctions are getting much less CB participation and for now they have been replaced by Caribbean hedgies. If that proved unsustainable, a dollar drop could be dramatic. I have a big part fo my assets in physical gold, so part of me is playing devil's advocate here. Puplava and others also believe gold's rise will be dramatic, but that does not necessarily mean the USD's movements will be similarly volatile. My point was that the CBs would be crazy to intentionally crater USD as that would be financial suicide, trade would halt, but that it could happen nonetheless, but cratering USD may not be caused by CB actions. I do wonder how prudent it is for a CB to have less USD in their reserves than the portion of their USD trade. For example, if they were underweight USD overweight gold and gold dropped but oil rose they might have to liquidate oil to buy energy. Perhaps energy independent nations like Malaysia and Russia can do so but I am not so sure about Japan and China. How underweight can they go realistically? D