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Strategies & Market Trends
The coming US dollar crisis
An SI Board Since May 2007
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Persistent high trade deficit of the last few years,
extremely high level of USD reserves in foreign central banks,
and the recent series of interest rates cuts by US Federal reserve
have led to the dollar crisis, a sharp drop of our currency.

Any currency crisis eventually involves much higher 10-year and
30-year interest rates and a meltdown of all asset classes,
with the possible exception of precious metals. This thread
will focus on the discussion of ongoing USD currency crisis,
and the ways to survive it.



Long-term target (~ 3-5 years) if the Fed stays the course:



US asset prices may skyrocket, in dollars, along with commodities,
if these actions are taken to the extreme (as they were) and the country falls
into hyperinflationary depression. US asset prices will fall sharply
priced in sound currencies and gold.

Hyperinflation chart - USD in gold OZ, monthly, is a straight line that
goes to zero in 2011.

fx.sauder.ubc.ca*&fd=1&fm=1&fy=2001&ld=31&lm=12&ly=2009&y=monthly&q=volume&f=png&a=lin&m=0&x=

Current tentative scenario: A double dip recession, with the second deeper dip
happening as the Fed tries to battle inflationary result of enormous bailouts. For it
to unfold, US has to come out of recession this year. Realistic scenario for USD:
Similar to 1985-95. The dollar will drop to new lows again and will probably bottom
in the 60-s. The grounds: US external net indebtedness is not that high.
$20 Trillion US assets held by foreigners, $17 Trillion foreign assets held by USA.
A genuine recovery after 2011-12 driven by manufacturing (optimistic scenario).
Hyperinflation for decades (pessimistic scenario).





"There is no means of avoiding the final collapse of a boom
brought about by credit expansion. The alternative is only
whether the crisis should come sooner as a result of voluntary
abandonment of further credit expansion, or later as a final
and total catastrophe of the currency system involved. The
breakdown appears as soon as the banks become frightened by
the accelerated pace of the boom and begin to abstain from
further credit expansion."

-- Ludwig von Mises

The Dark Side of the Credit Boom

"Against this backdrop the crucial question is: where is the borderline between a "good" and "bad" rise in debt-to-GDP ratios? To Austrian economists the ratios spell danger. They maintain that today's government-controlled paper-money systems have decoupled credit expansion from the economies' productive capacities: "circulation credit" feeds a "credit boom" that is doomed to end in severe economic, social and political crisis. Austrians fear that the collapse of the credit boom will lead to the destruction of the currency through a deliberate policy of (hyper-)inflation, destroying the free-market order."

mises.org
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59831Nah... Can't be true can it? [graphic] Russia and the fighters operating iThe Pre Beakerite-2 hours ago
59830Yeah, I think some elements of the public at large were close to becoming sympatThe Pre Beakerite-3 hours ago
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59827first 15 minutes good enough on it's own [youtube video]ggersh-yesterday
59826his 20 year old bride left him she could not put up with a DICK tator-g/ng-Pogeu Mahone-yesterday
59825http://wolfstreet.com/2017/03/20/sp500-eps-stagnate-despite-share-buybacks-non-gggersh1Tuesday
59824when the premise is wrong, doesn't it all just go downhill from there. backggersh-Tuesday
59823--Claiming that supporters of...anti-establishment...on the left and right aremarcher-Monday
59822 comments worth the read as well nakedcapitalism.com Some Easy Straw Men: Zackggersh1Monday
59821example....monopolies don't work Message 31036994ggersh-Monday
59820damn, we're getting up there, -sigh- it's sorry to see the greats leaviggersh-Sunday
59819good vid. and interesting that they used abstract cartoons.marcher-Sunday
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59817chuck berry passed. first recording and his crazed, silly stage stuff: youtu.bemarcher1last Saturday
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59815somewhere along the line, $30k a day, trumps truth. -nfg-ggersh1last Saturday
59814maddow, what a joke apologist. -ng-marcher-last Friday
59813sanity....wanting to lose alternet.orgggersh-last Friday
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59809The club is hardly exclusive. I've known him for years and he won't evenElroy Jetson-March 15
59808I tried to post this on Elmat's new board and found that I had been banned! bruiser981March 15
59807Gotta say yes, China makes all our crap also maybe Pravda could've been rigggersh-March 15
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