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The strength of a nation lies in the strength of its currency. That phrase has always stuck with me. Thus, during the early fall of 2007 when the US market bubble was being inflated to a tipping point by the US Federal Reserve, I never bought into the lies being propagated in the mass media that the bubble was sustainable. Why? Throughout my various business travels in different countries as US stock markets continued to climb higher late in the third quarter of 2007, I noticed that the US dollar's purchasing power was still declining strongly and barely more worthy than monopoly money. Thus, given the huge disconnect between the strength of the American currency and all the "experts" on TV that were applauding the strength of the US economy, I positioned myself to benefit from a crash instead. In fact, now that I spend more time in Asia than in the United States, my only saving grace is that I started converting dollars into gold years ago and have since converted my business model into a gold standard, which I believe many other businesses worldwide will emulate in future years as this crisis deepens.
in Dubai, when I asked him if his family business accepts US dollars for payment, his response was laughter. The truly ugly US dollar chart below also confirms the stance I take in this essay. It does not surprise me at all that the banking elites continue to lie about the true state of this crisis.
Originally posted by projectvxn
This is a new age of "Huh?". The worst of it is that no one seems to notice the obvious flaws in what they are lead to believe.
Are You Ready for Dow 20,000?
A strategist with a talent for calling stock-market lows sees one now.
DESPITE THE BEAR STEARNS BAILOUT AND THE FED'S rate cut, a sense of foreboding is still abroad on Wall and Main Streets. Few investors feel good with an economic slowdown gathering force, the dollar in the dumps and contagion threatening to hit financial sectors previously unscathed or not even suspected of being at risk.
This in mind, we contacted James Finucane, a 67-year-old stock strategist who now works as a consultant in West Lafayette, Ind., home of Purdue University ("modest cost of living, a great brew pub and incomparable high-school hoops," he gushes). Among his talents: pool hustling. He was the 1961 National Student Unions pool champ, representing Notre Dame.
He also has been great at calling stock-market lows, including that reached in the week after the October 1987 crash. "Lows have always been easier for me to call than tops. I was premature in seeing the 2000 stock market high, for instance," notes Finucane, who long labored in Chicago at Stifel, Nicolaus.
(This was his prediction from March 2008...NOTE EDIT WR)
Originally posted by warrenb
reply to post by whiteraven
more and more investors are recommending people take their money out of the markets and put them into metals or just cash out
things are getting serious
The US dollar is not Russia’s basic reserve currency anymore. The euro-based share of reserve assets of Russia’s Central Bank increased to the level of 47.5 percent as of January 1, 2009 and exceeded the investments in dollar assets, which made up 41.5 percent, The Vedomosti newspaper wrote.
Russia-EU relations reach peak of tension
The dollar has thus lost the status of the basic reserve currency for the Russian Central Bank, the annual report, which the bank provided to the State Duma, said.
In accordance with the report, about 47.5 percent of the currency assets of the Russian Central Bank were based on the euro, whereas the dollar-based assets made up 41.5 percent as of the beginning of the current year. The situation was totally different at the beginning of the previous year: 47 percent of investments were made in US dollars, while the euro investments were evaluated at 42 percent.
EASTER ISLAND GIVES AN EXAMPLE OF SOCIAL BREAKDOWN
An example from one of the most famous cases of social collapse is relevant here. On Easter Island, as I think most people know by now, the native culture built a thriving society that got most of its food from deepwater fishing, using dugout canoes made from the once-plentiful trees of the island. As the population expanded, however, the demand for food expanded as well, requiring more canoes, along with many other things made of wood. Eventually the result was deforestation so extreme that all the tree species once found on the island went extinct. Without wood for canoes, deepwater food sources were out of reach, and Easter Island's society imploded in a terrible spiral of war, starvation, and cannibalism
U.S. dollar’s 18-month stint as a safe-haven currency is over
The U.S. dollar’s 18-month stint as a safe-haven currency is over. Its status as a proxy for one of world’s great debtors has just begun.
"I hardly talked to a single person in the last couple of weeks -- hedge funds and mutual funds managers -- who is bullish the dollar," says Marc Chandler, head of global currency strategy at Brown Brothers Harriman. Many mutual fund managers are chasing returns, says Mr. Chandler, after missing out on the first leg of the market rally. "Many people who were reluctant to get involved are being forced to get involved," he says.
The fall in the dollar over the past two weeks appears to represent a major change in sentiment away from the currency. As the financial world crumbled around them, investors were only too happy to seek out the safety of the big, deep U.S. treasury market.
Now markets appear to be on the mend, investors have foresaken the greenback. The prospect of years of multi-trillion deficits, to fund an economic recovery, has only hastened their exit. Unless there is a major correction in the U.S. stock market in the near term, "trend following" currency investors will continue to sell the dollar, says Ashraf Laidi, chief market strategist at CMC Capital Markets.