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

To: axial who wrote (20944)	6/23/2009 1:21:23 PM
From: Archie Meeties	2 Recommendations Read Replies (3) \| Respond to of 71455

Maybe we can think about what we do know. We know that despite quite a bit of sound and fury, purchases of treasuries are not weak. The last auction of the 30 year was oversubscribed 2:1. We know that China has moved purchases to the short end but continue to buy in the same or maybe increased amounts. We know that most of the buyers of treasuries have a strong interest in preventing dollar weakness, as a weak local currency is the cornerstone of their economy. We can also take a reasonable guess that we are at the absolute peak of debt creation/gdp. All the players know this, and yet the dollar is basically unched from when Vi started this thread. To me that is a loud and clear message from the market and one of the reasons gold seemed like a good short a while back. Long term all currencies have uncertainty. Uncertainty provides necessary feedback. The only way to take some certainty out of your currency is if you have a psuedo-currency, like the yuan, which isn't freely traded but subject to strong and continuous intervention. The title of this thread should probably be "the coming ruble crisis". The incessant wailing from Moscow about the dollars demise and inclusion of the ruble in a basket of reserve currencies (gdp the size of Italy!) is an amusing diversion from the underlying fragility of the ruble. I'm considering shorting the ruble vs. euro here. Or I might just sell XRU.