Dollar Collapse coming

Kitco ^ | 5/8/06 | Kitco

[wotan]

When a currency loses the confidence of its people, its fall becomes exponential, as has happened to the Zimbabwe $, where in 1982 one U.S.$ equalled 1 Zimbabwe $. Today around Z$200,000 buys one U.S. $ if you can find someone idiot enough to sell one for the Z$.

In day-to-day terms, the smallest note in Zimbabwe a Z$500 is the size of a U.S.$. The price of a single-ply sheet of toilet paper is more expensive at around Z$867.

The U.S.$ is nowhere near there, but clearly the U.S. Administration has no plan or even desire to rectify the U.S. Trade deficit.

[wotan]

Don't let the Dow go to your head. Trouble's brewing as government spending rages unchecked in the US. Also, here on China and Japan collaborating on an Asian Currency Unit with China on top. A common Asian currency down the road?

[A CA Guy]

Zimbabwe is a sh!t hole. How could anyone even put these two nations in the same article much less in this frame of thinking?

Retarded IMO.

[A CA Guy]

Oh geez, the site is a bunch of holes trying to sell gold and such.

[Cementjungle]

Oh geez, the site is a bunch of holes trying to sell gold and such.

Yep, gold's nice and high right now, so I can see their desire to sell some!

[John Valentine]

Dollar Collapse coming

When?

Please be specific.

You see, I've been hearing this same story for over 50 years, and I keep losing my shirt on short sales of US$ futures.

Meanwhile, I just read a story about how the Euro was unlikely to last another five years due to centifugal economic forces plaguing the EU. I find this scenario far more plausable than a hypothetical Asian common currency (now there's a pipe-dream) or other disaster befalling the greenback.

[MedicalMess]

If our dollar goes down the drain then...

All the illegal aliens will go home?

[DB]

"...but clearly the U.S. Administration has no plan or even desire to rectify the U.S. Trade deficit."

The markets will correct the trade deficit - if it needs correcting. The less valuable the dollar, the more exports and the fewer imports. It is self correcting - as long as the government doesn't attempt to "rectify" it.

[Cindy]

Wotan, my $$$'s are fine, thank you.

[wotan]

Personally, I prefer my gold bars. Especially lately.

[CzarNicky]

First Real Estate and now this what will be the next big bang, pork bellies?

[familyop]

The piece was written from ignorance or to start a panic. The US dollar must equalize more with currencies of our "trading partners" in order for the trade deficit to fall. That inevitable process is worrisome to import merchants but should be great news for employees in "outsourced" occupations and for US manufacturers.

[familyop]

"Meanwhile, I just read a story about how the Euro was unlikely to last another five years due to centifugal economic forces plaguing the EU."

Yes, and the Euro must also be brought gradually toward currency values like that of the yuan. Otherwise, the Euro-folks will probably eventually feel a more sudden drop.

[capitalist229]

Our esteemed politicos have abandoned the dollar under pressure from the G7, plus the Schumer tariff threat against China.

The key is to manage a gradual, orderly decline.

BUMP

[.cnI redruM]

Sure, if the Dems nominate Mugabi and he wins two terms, I'll bet the Greenback is done for.

[SIRTRIS]

Yup, another expert! dime a dozen at getting it wrong!

[GodGunsGuts]

Most of the (sound) economists I have been reading have been saying that the dollar must fall at least another 20 to 30 percent in order to address the trade deficit. Add to that the budget and current account deficit and you have the recipe for not just a fall, but a free fall! Got GOLD???

http://neweconomist.blogs.com/new_economist/2006/01/feldstein_the_d.html

[GodGunsGuts]

ping!

[GodGunsGuts]

Virtually all fiat currencies, with the possible exception of commodity-based currencies such as the Cando, will be shown for what they really are (read: trash) in the not too distant future. Got Gold????

[familyop]

"Virtually all fiat currencies, with the possible exception of commodity-based currencies such as the Cando, will be shown for what they really are (read: trash) in the not too distant future. Got Gold????"

It might be worse that that, if we wait too long to take down Iran's military forces: more like, "Got food?"