Dollar comeback
impactnow
4/30/2011 11:06:36 PM
Based on the current economic and debt situation in the US I would not be looking for the dollar to make a comeback anytime soon, sadly I feel the days of the dollar being the universal standard of wealth are gone due to poor decisions by our Washington representatives. Commodities are becoming the “currency” of choice for many investors and the Euro is facing its own devaluation issues based on its union countries financial health.
When is the dollar going to make a comeback? Should we bank on it rising again, or should we look other places?
Re: Tough time ahead
yalanand
4/30/2011 11:48:34 AM
Thanks for the reply Scott, just wondering what other currencies can replace Dollor as possible "global currency". Euro was favourite couple of years back, not sure if it's still favourite to become new global currency.
Re: Its not just the US Federal Reserve...Everybody's Doing it...
Scott Raynovich
4/28/2011 11:02:17 PM
I think Steve Jobs has it all. And the People's Republic of China.
Re: Its not just the US Federal Reserve...Everybody's Doing it...
Tenacious
4/28/2011 10:56:00 PM
Wish I had some left to hoard. Who the heck has it all? If you talk to average people, they'll tell you they have more debt than equity.
Re: Its not just the US Federal Reserve...Everybody's Doing it...
Scott Raynovich
4/28/2011 6:24:03 PM
The Fed measures it. It can be tracked here:
http://research.stlouisfed.org/fred2/series/M2V?cid=32242
When velocity is this low it just means that people are hoarding cash rather than spending and investing it.
Re: Its not just the US Federal Reserve...Everybody's Doing it...
Scott McCaig
4/28/2011 3:32:49 PM
Scott,
How is velocity measured? I understand the concept and the importance, but I've never seen a good way to track it.
Re: Its not just the US Federal Reserve...Everybody's Doing it...
Scott Raynovich
4/28/2011 12:36:31 PM
Nice chart Noreen!
You scooped me on my next post!
Re: Its not just the US Federal Reserve...Everybody's Doing it...
Noreen Seebacher
4/28/2011 12:25:10 PM
I understand things better when I visualize them. So I found this chart helpful.
Re: Its not just the US Federal Reserve...Everybody's Doing it...
back2basicz
4/28/2011 10:41:40 AM
Scott,
It all depends on how you define HyperInflation.
If you are talking about Double Digit real Inflation(What people need for everyday sustenance in America),then we are already seeing it everywhere except in Housing.
On the other hand if you are talking about a total loss of faith in the Currency where people go around shovelling wheelbarrows of Dollars to buy a loaf of bread(ala Weimar Germany and Zimbabwe);then I don't think we will ever see it in America.
The reason is Three-fold
1)Self-Interest on part of Central bankers and the Wall Street Cartel-They know better than anyone else if ordinary people lose total faith in Paper Money/the US Dollar they will move back to the Gold Standard.At that stage the amount of Power and Authority(as well as ability to Print at will) will be very heavily dimnished for these guys.It could very well lead to the abolishment of the US Federal Reserve!!!
2)No Sign of reversing the rate of Fall of Velocity of Money(which you also have pointed out here);for atleast another 2 years or so to come.
3)What happens to all those Central Banks Globally who hold more than 50% of their assets in US Dollars??? Are they ready to move to another Reserve Currency???Not yet,not for the next 3-5 years atleast.
Regards
Ashish.
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