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Imminent collapse of the US dollar

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Imminent collapse of the US dollar

Unread postby NevadaGhosts » Sun 30 Jan 2005, 14:47:44

"The U.S. dollar is no longer -- in our opinion is no longer -- (seen) as a stable currency, and is devaluating all the time, and that's putting troubles all the time," Fan said, speaking in English."


http://biz.yahoo.com/ap/050126/world_forum_china_5.html
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Unread postby uNkNowN ElEmEnt » Sun 30 Jan 2005, 15:21:50

"But this time, I think Chinese authorities will not forget it. Now people understand the U.S. dollar will not stop devaluating."


Thar she blows!!
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Unread postby maverickdoc » Sun 30 Jan 2005, 15:29:58

this is old news bill gates in devos said on satuday the the dollar will continue to fall. time to buy euros and swiss francs while you can
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Unread postby NevadaGhosts » Sun 30 Jan 2005, 15:33:12

maverickdoc wrote:this is old news


Tell that to the millions of Americans that are completely clueless to what is about to happen. They will just laugh at you and say 'Yeah right'.
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Unread postby maverickdoc » Sun 30 Jan 2005, 15:34:46

NevadaGhosts, did you see last weeks saturday night live they had a skit on the "weakling dollar"
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Unread postby NevadaGhosts » Sun 30 Jan 2005, 15:47:30

maverickdoc wrote:NevadaGhosts, did you see last weeks saturday night live they had a skit on the "weakling dollar"


No, didn't catch it. Good to see it is hitting mainstream. But it still won't stop the average American from spending beyond their means. Without spending, then there is no economic growth.
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Unread postby uNkNowN ElEmEnt » Sun 30 Jan 2005, 15:51:26

There but for the grace of common sense, go I. 8O :P
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Unread postby maverickdoc » Sun 30 Jan 2005, 15:54:20

No, didn't catch it. Good to see it is hitting mainstream. But it still won't stop the average American from spending beyond their means. Without spending, then there is no economic growth.

Very few american can make that connection. an even bigger problem is the govt spending beyond it's means. at any rate the "collapse" will be gradual about 10-15 cents a year. Baring a terrorist attack or another war ofcourse
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Unread postby Permanently_Baffled » Sun 30 Jan 2005, 15:56:18

Just a quick question on this topic. At what level would the dollar have to depreciate to for it to start seriously doing economic damage to the US(ie double digit inflation).

Or is it more likely that a weaker dollar will eventually lead to higher interest rates which will collapse the domestic housing/personal debt bubbles?

The reason I ask is that the dollar vs the Euro has depreciated from 1 euro = 80 US cents to 1 euro = $1.30 and the US continues to grow. This is a substantial depreciation and yet a "collapse" hasn't materialised.

PB :)
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Unread postby NevadaGhosts » Sun 30 Jan 2005, 16:02:00

Permanently_Baffled wrote:The reason I ask is that the dollar vs the Euro has depreciated from 1 euro = 80 US cents to 1 euro = $1.30 and the US continues to grow. This is a substantial depreciation and yet a "collapse" hasn't materialised. PB :)

I think the reason we continue to grow is because the American consumers and companies are taking on more and more debt , which is encouraged by the US government to keep economic growth going. But most economists now agree that this cannot continue wiithout a collapse. Personal and corporate financial debt is about to crush everyone.
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Unread postby maverickdoc » Sun 30 Jan 2005, 16:10:51

Permanently_Baffled wrote:Just a quick question on this topic. At what level would the dollar have to depreciate to for it to start seriously doing economic damage to the US(ie double digit inflation).
Or is it more likely that a weaker dollar will eventually lead to higher interest rates which will collapse the domestic housing/personal debt bubbles?
The reason I ask is that the dollar vs the Euro has depreciated from 1 euro = 80 US cents to 1 euro = $1.30 and the US continues to grow. This is a substantial depreciation and yet a "collapse" hasn't materialised.

For any currency to fall like that (50%) in 4 years you would expect a catastrophic collapse. People would be scouring the streets looking through garbage dumps for food. Just look at Argentina. But the US is different. The dollar is the world’s fiat currency meaning no matter what you need to have dollars in order to buy oil. This was the reason for the Iraq war and the upcoming Iran war. To answer you question the regardless of how much the dollar falls there will not be much of a problem unless investor (and more importantly Oil producers) loose faith in the dollar. To prevent this greenspan will raise the interest rate causing like you said “collapse the domestic housing/personal debt bubbles.â€
Last edited by maverickdoc on Mon 31 Jan 2005, 00:14:25, edited 1 time in total.
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Unread postby uNkNowN ElEmEnt » Sun 30 Jan 2005, 16:18:17

The dollar is the world’s fiat currency meaning no matter what if you need to have dollars in order to buy oil


You may want to check on that, I believe that is not correct.
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Unread postby Permanently_Baffled » Sun 30 Jan 2005, 16:21:10

Thanks for the responses. When do the FED next meet to discuss interest rates? , it will be interesting to see if they increases rates by more that a quarter point.

PB :)
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Unread postby maverickdoc » Sun 30 Jan 2005, 16:23:44

uNkNowN ElEmEnt wrote:
The dollar is the world’s fiat currency meaning no matter what, you need have dollars in order to buy oil
You may want to check on that, I believe that is not correct.

As far as I know OIL IS ONLY SOLD IN US DOLLARS if you find some thing that says it is not I would be much obliged. please post it. Saddam sold oil in euros in 2000. Iran might start in 2006
Last edited by maverickdoc on Mon 31 Jan 2005, 00:12:55, edited 1 time in total.
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Unread postby uNkNowN ElEmEnt » Sun 30 Jan 2005, 16:36:10

You are correct. Only Sadam had sold oil in Euros, Iran has liked the idea and been talking about it since 1999. The lateset time they "talked" about it the got labelled as being int the "axis of evil". Venezuela has been bartering oil, in effect avoiding dollars or euros (which then prompted the attempted coup).

As well Syria has also talked about dollars instead of Euros. but they (as well as Indonesia if memory serves) have backed off. End products are traded in Euros, but not the bulk commodity.
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Unread postby savethehumans » Sun 30 Jan 2005, 23:41:27

Figures. For the first time in my life, I actually have some money in the bank, and now it's gonna be worthless! :cry:

Sure hope I can buy/learn all I need to survive what's coming before it gets here.... :(
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Unread postby Kingcoal » Mon 31 Jan 2005, 10:11:07

"Money" is debt created out of thin air. The US is the worlds biggest "producer" of money (read debt.) Since the dollar is the world’s most popular reserve currency, most of the rest of the world depends on the USA to produce conditions that produce economic growth. Without that growth, the dollar slides and the system is in trouble. This is the infinite growth concept discussed to death on this site.

Real growth requires the creation of increased value. Value generally comes from either increased resources or more efficient use of resources. After that it becomes very complex. Computer technology has allowed our society to use the same resources more efficiently. However, I believe we hit a detour in this process with Asia and other "low cost regions" (LCR.)

Instead of investing in efficiency improvement, business, particularly American business have simply "outsourced" production to people who work for next to nothing and don't care about environmental impact. This system worked great when oil was cheap, but is now under stress. The LCR is now faced with the same problems as their customer, even with super cheap labor. It will only get worse as oil goes up in price.

In the "outsourcing age," the USA put itself in the position of maintaining cheap, stable energy prices, as well as a constantly expanding markets for imported products. In other words, the "job" of the US was to provide cheap energy and keep consuming more and more products every year.

It appears that the US is loosing it's ability to provide cheap oil prices. With that, it's ability to control it's economy and the world economy. Unless this is reversed, the infinite growth system will collapse.

In light of the above, annexing Iraq isn't a bad idea, at least on paper. Someday soon, Saudi Arabia will see a dramatic loss of oil production. Iraq has the ability to fill a large part of that void.

If you think that dollar collapse will happen soon, I don't see other paper currencies as a haven. Gold, Grain and Guns become the currency of choice in times of emergency. Let me add one more currency: oil.
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Unread postby Grimnir » Mon 31 Jan 2005, 11:26:09

maverickdoc wrote:
uNkNowN ElEmEnt wrote:
The dollar is the world’s fiat currency meaning no matter what, you need have dollars in order to buy oil
You may want to check on that, I believe that is not correct.
As far as I know OIL IS ONLY SOLD IN US DOLLARS if you find some thing that says it is not I would be much obliged. please post it. Saddam sold oil in euros in 2000. Iran might start in 2006

Malaysia sells its oil for gold (dinars).
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Unread postby 0mar » Mon 31 Jan 2005, 13:43:58

The dollar is the world’s fiat currency meaning no matter what if you need to have dollars in order to buy oil

Fiat actually means you can print at will. There doesn't need to be a reserve (like gold) to back it up.
Joseph Stalin
"It is enough that the people know there was an election. The people who cast the votes decide nothing. The people who count the votes decide everything. "
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Unread postby NevadaGhosts » Mon 31 Jan 2005, 16:26:45

savethehumans wrote:Figures. For the first time in my life, I actually have some money in the bank, and now it's gonna be worthless! :cry: Sure hope I can buy/learn all I need to survive what's coming before it gets here.... :(

It's time to invest in Euros. And pull your money out of the stock market! Warren Buffet has already pulled every last penny out of the US stock market. Perhaps he knows something...
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