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

To: The Wharf who wrote (4998)	3/13/2008 10:29:43 PM
From: Real Man	Read Replies (2) \| Respond to of 71475

Nah. It's a nasty banking and currency crisis. They are trying to save the system from a complete meltdown. I'm not sure there is a way out - OTC derivatives are completely out of control and must collapse, taking the system down, sooner or later. They can't continue to grow rapidly to infinity, it's a huge global Ponzi scheme. Just as derivatives drove risk premiums lower on the way up, and liquidity seemed plentiful due to huge leverage, they are now driving these premiums much higher on the way down. The primary reason were the non-payments on mortgages, so the risk HAD to be revalued. Now, I think the dollar had SOME significant support through carry trade, allowing high trade deficit without a major decline for some time due to higher rates in the US than elsewhere. Now rates are lower, and the same derivative models will work the downside. Gulp!