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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: John Vosilla who wrote (2732)	11/30/2007 10:39:17 AM
From: DebtBomb	Respond to of 71463

Excuse me....I don't even hardly read Mish's forum. You're wasting bandwidth here. Carry on.

To: John Vosilla who wrote (2732)	11/30/2007 11:50:11 AM
From: Riskmgmt	Read Replies (5) \| Respond to of 71463

Ultimate questions Vi, myself and a few others address is the low long term rates and how much longer foreigners will accept such low returns in order to fund our excess debt creation and how long before back end monetezation of the curve and excess money creation lets inflation really out of the bag for good setting off 70's style stagflation.. Doom and gloom comes out of this near term with a major back up in long term rates. Much easier to muddle through this with real interest rates negative and deficit spending in overdrive with no ramifications other than a controlled dumping of the dollar IMHO. John: Are we overdoing the negativity? I see 7.5 billion invested in Citi from really sophisticated investors. Are they crazy? As you said in an earlier post to Europeans the USA is on blue light special. Apparently, it is not just the Europeans either. Not to minimize our problems of subprime/loss of credibility etc, but let us examine the plus side. We still are the biggest economy, we have enormous mineral wealth, one of the better infrastructures, and plenty of room to expand our population. The biggest financial center and the most clout worldwide. Admittedly, some of these things are in decline but compared to the recent past when we had an arms race, most of Eastern Europe in the communist block, Cuba crisis, Vietnam war etc., things aren't so bad. I have been in China and SE Asia and lived in Europe and I can tell you from experience they all have problems and some much harder to solve than ours. Now to the question that you pose, how long will foreigners accept low returns etc. Every time we have a scare, money flows into the T-bonds and t-bills, a flight to safety. If one looks around at the world in times of crisis what would be better than US treasuries? Where is there a better legal, free system? America is on sale and is getting cheaper as the dollar weakens but nothing goes one way forever. If we had a strong leader as our next President how long would it take to turn this country around? It is fashionable to beat upon America right now but it's still a great place to live and the future can be awesome.