Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: gregor_us who wrote (13605)	10/27/2008 1:15:58 PM
From: Wyätt Gwyön	1 Recommendation Read Replies (1) \| Respond to of 71407

i understand what you are saying in your black hole analogy. i just don't know enough to say whether i think it is true. the reason i can't say is, i don't know what will happen to the heretofore not discussed "moving parts" in the event of a Japanese meltdown. specifically, Japan is a huge creditor. in a meltdown, they are likely to call home a lot of capital. this means selling forex (mainly USD, but others as well) and buying JPY. there could be trillions of dollars of inflows into Japan, and this would be a new source of JPY demand. right now, we have speculative unwind (how much further to go, we don't know). next, we could have unwind of Japan's international creditor position built up over the past 40yrs. that could even be worse.

To: gregor_us who wrote (13605)	10/30/2008 9:09:17 AM
From: Wyätt Gwyön	Read Replies (1) \| Respond to of 71407

imo the current extreme volatility in currencies means one can have equity-like return expectations without even buying equities (just by owning currencies that have lost a huge amount, as long as they belong to reputable economies and not pseudo-economies like Iceland). although i am now 32% equities, another 63% of my PF is in gold, AUD, CAD, and BRL-denominated bonds. only 5% in USD. therefore i consider myself to be long 95% assets which can have equity-like returns. NB. "equity-like returns" are not necessarily positive -gn-, though in this environment i'm willing to take the risk. PS. Korean market last night had record rallies in both currency and stocks. keep an eye on EWY today.