Posted on 04/17/2009 7:02:08 PM PDT by FromLori
To be sure, the dollar’s strength has surprised a lot of people, including me. And it’s tough to bet against the greenback when other currencies are looking even worse. Now, however, the dollar may be coming up against some simple but brutal math — foreign central banks may not be able to finance much of the 2009 U.S. fiscal deficit.
The U.S. needs to borrow $3.25 trillion this fiscal year, according to Goldman Sachs. President Obama is asking Congress to approve a whopping $3.55 trillion budget for 2010, and that may not be enough — the nonpartisan Congressional Budget Office estimated the deficit at $1.38 trillion, higher than the White House’s $1.17 trillion projection.
The U.S. needs to borrow $3.25 trillion this fiscal year. And if foreign central banks cut back on buying Treasuries, the mighty greenback could be in for a humbling plunge. So, if foreign central banks stop or even slow down their purchases of U.S. Treasuries, the mighty greenback could be in for a humbling plunge.
And here’s where the worrying starts:
China is the top holder of U.S. Treasury bonds with approximately $739.6 billion as of January. The Chinese government actually sold bonds heavily in January and February before resuming purchases in March, according to data released over the weekend by China’s central bank. The Federal Reserve is clearly worried about the ability of foreign central banks to keep buying America’s debt. So now, the Fed is buying U.S. Treasury securities and completed its eighth purchase on Monday. As far as I’m concerned, a government buying its own bonds is like a snake eating its own tail.
Three Reasons These Dollar Worries Continue to Mount …
#1) Global demand for dollars is slowing. Brad Setzer at the Council on Foreign Relations
(Excerpt) Read more at marketoracle.co.uk ...
If they cannot borrow it, being democrats they will just print it.
bookmark
The dollar is still preferred to any other currency... and since we don’t want a new global currency we need to President Obama (and frankly President Bush43’s) policies to have not done irreparable harm.
even if china wants to buy the bonds, they can’t because they dont have the enough usd from chinese product they sell the the usd. Americans are buying less, so China have less USD to recycle them into t-bills
guess what? the Chinese are buying copper, zinc, aluminum, and many other metals and resources. It cleverly gets them out of holding dollars without blatantly buying gold or holding treasuries.
I saw an article on here about the chinese doing that, and maybe starting to do copper instead of a gold standard? I don’t really understand alot of this stuff, but I kinda figured that could be a problem....
Is this were “we” opt for a North American currency (Amero) rather than a global one?
I’m not familiar with this guy...others might be...but what he’s saying sure rings true:
Collapse of US Dollar and the Amero
I’m curious, if anyone actually watches the video in my post above...if you disagree or think his premise is far fetched...can you help me understand why...cause it sure seems to me like he’s right on the money (no pun intended). Thanks.
I don’t know if they will call it the Amero lol I think they may think again after all the outrage about the SPP - NAU etc. it rings true to me too just on common sense factors...yikes!
I believe that the destruction of the dollar AND the US economy is part of the master plan being promulgated through the bamster by his masters.
No one can seriously believe that 0 of the dims have any intention of leaving the USA intact, can they? Aside from the MSM morons and the sheeple of course.
>>even if china wants to buy the bonds, they can’t because they dont have the enough usd from chinese product they sell the the usd. Americans are buying less, so China have less USD to recycle them into t-bills<<
Well they have $2 trillion in reserves and they are still increasing , just slower.
If they want to they can stick it in their cap and call it macaroni. It still won't be worth sh*t.
Its really easy...we’ll just borrow from ourselves to pay back the debt...</sarc>
They might be right.
What kind of choice are we going to have, if China doesn’t want to, or simply can’t, fork over the cash to keep funding our addiction? It’s not like Americans and our government are going to suddenly learn frugality. The only alternative will be hyperinflation.
Ya know, we have a bunch of dumb son of a @#$!#$ running our government.
This is just bad. Real bad.
We allow a communist country like China to control us via monetary arm twisting.
Oh my, that is the single most scariest thing I’ve ever seen. I so hope to the good lord above he is wrong.
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