Future of the dollar

[abudabit]

Ok, so the dollar is taking a dive and things aren't looking good for its future. Government debt continues to grow with no decrease in sight, and the prospect of an increase in availability vs real growth is high. More and more organization, trading blocks, etc. are switching or discussing switching away from the dollar.

What is the future of the dollar? Will the Euro take its place?

If the government can't borrow enough in dollars (since your debt asset will decrease in value) will we see hyper inflation as printing becomes the only alternative? Or will we see the government borrow at increasingly higher interest rates? Or will something else entirely happen?

Will the US regress to an export based nation?

These are the types of questions we in America are going to have to increasingly look at - the situation is getting worse the more time goes on. What say you?

[d0uche_n0zzle]

Race War!

[seeinred]

We'll obviously just take over the rest of the world if it ever gets to the point where our economy becomes so inferior.

[abudabit]

How would we fund that? We wouldn't be able to borrow, shit we wouldn't be able to borrow enough right now.

[seeinred]

We'll get a few "rich" countries to help us out, then nuke 'em once we get what we need from them. Ideas like this are why I need to be president.

[Voss's Tumor]

I think before Bush exits the White House he's going to declare Happy Meal toys the only true form of usable currency.

Your average 4 door sedan will cost 1,100 Beanie Babies.

[LiddyRules]

I think before Bush exits the White House he's going to declare Happy Meal toys the only true form of usable currency.

Your average 4 door sedan will cost 1,100 Beanie Babies.
Mac the Night and Fry Kids, you're going to make me a power player.

[THE FEZ MAN]

Race War!
x2

[Xyn]

I think we'll go back to trading sea shells and tobacco.

[FAZ8218]

The Chinese are coming.

[martianvirus]

N
U
K
E
S
!

They dont even cost money, we already have them. All thats needed is a few buttons pushed.

[Chino Kapone]

The Gov't has completely fucked us. If neither the Democrats or the REpublicans are willing to change their ways then we are fucked.

They borrow too much and frivolously spend our tax dollars. They will borrow $200 million to build a bridge to nowhere.

Tom Coburn is the only one who can save us.

[abudabit]

The Gov't has completely fucked us. If neither the Democrats or the REpublicans are willing to change their ways then we are fucked.

They borrow too much and frivolously spend our tax dollars. They will borrow $200 million to build a bridge to nowhere.

Tom Coburn is the only one who can save us.

Like his spending record, but he isn't the only one. Ron Paul has a great one too, and while he is only a congressman and not a senator he does happen to be running for president (http://www.ronpaul2008.com).

[UCFGavin]

Like his spending record, but he isn't the only one. Ron Paul has a great one too, and while he is only a congressman and not a senator he does happen to be running for president (http://www.ronpaul2008.com).

word. if dr. paul gets elected, i think the US will remain on top. if not, i see a fairly quick decline going into the next election cycle.

[Chino Kapone]

Like his spending record, but he isn't the only one. Ron Paul has a great one too, and while he is only a congressman and not a senator he does happen to be running for president (http://www.ronpaul2008.com).

He wants to put us back on the gold standard and yank the troops. He gets my vote.

[weakside]

One of my friends who studied Economics tried to explain to me why over the short term a weaker dollar actually helps American trade in some way but I was too stupid to follow. Go figure.

[abudabit]

One of my friends who studied Economics tried to explain to me why over the short term a weaker dollar actually helps American trade in some way but I was too stupid to follow. Go figure.

When the dollar is less valuable foreigners can purchase American goods for less. It makes it affordable to buy American. Our trade deficit decreases. And that is what we are seeing now, our trade deficit is indeed decreasing.

On the flip side that means foreign goods will become more expensive. Inflation.

And in the long run it can turn into even more inflation. If you want to see just how bad it can get, look at Zimbabwe (extreme example I know).

[weakside]

When the dollar is less valuable foreigners can purchase American goods for less. It makes it affordable to buy American. Our trade deficit decreases. And that is what we are seeing now, our trade deficit is indeed decreasing.

On the flip side that means foreign goods will become more expensive. Inflation.

And in the long run it can turn into even more inflation. If you want to see just how bad it can get, look at Zimbabwe (extreme example I know).

Ah, thanks! You explained a hell of a lot more clearly than he did.

This would explain why he told me China is not happy about our dollar being weaker.

[wes mantooth]

Ah, thanks! You explained a hell of a lot more clearly than he did.

This would explain why he told me China is not happy about our dollar being weaker.


Yeah, we owe them a shitload of money and they're pissed because the money they get back is worth a lot less now.

Having a weak dollar is good in some respects because it helps things like manufacturing due to increased exports. The problem is alot of our manufacturing has been exported to other countries over the years. Companies like Boeing should do really well though. The real downside is that the dollar has gotten so low that if the Fed continues cutting rates we could wind up having deflation (where people quit spending money to the point that increased liquidity has no effect). See Japan in the early 90's for an extreme example. They cut their interest rates to zero and they're just now coming out of their downturn.

[Chino Kapone]

Yeah, we owe them a shitload of money and they're pissed because the money they get back is worth a lot less now.

(where people quit spending money to the point that increased liquidity has no effect).

This is whats FUCKING KILLING my business right now. I run my own furniture store, but because of the down turn in the housing market (which is 25% of our economic spending) my business has dropped 40% in the past year and a hlaf. I just have to wait out the storm. In Northwest Arkansas here, we have ben riding this boom in the economy over the past few years, but now the whole motherfucking place is overbuilt. There are too many homes and not enough jobs. Too many resturaunts, malls, furniture stores, coffee shops without the population to support it. IT FUCKING SUCKS!

[Vyce]

We'll obviously just take over the rest of the world if it ever gets to the point where our economy becomes so inferior.

Not necessary. America will just be forming a North American Union with Canada & Mexico.

Ron Paul told me so.

[Chino Kapone]

Not necessary. America will just be forming a North American Union with Canada & Mexico.

Ron Paul told me so.

I read something about that. Mexico, US, and Canada could all have the same currency, or something like that..... i dunno if that would be good or bad.... We will just keep opening up the borders this way when china takes us over they will just control the whole continent.

[UCFGavin]

He wants to put us back on the gold standard and yank the troops. He gets my vote.

he doesn't necessarily want to go back to a traditional gold standard. however, he does support a backed currency (for at least competition purposes, allow the free market to choose what it wants).

[UCFGavin]

Not necessary. America will just be forming a North American Union with Canada & Mexico.

Ron Paul told me so.

i like the subtle shot you took there. very 12 year old like of you :icon_cool

[Schmed]

The Gov't has completely fucked us. If neither the Democrats or the REpublicans are willing to change their ways then we are fucked.

They borrow too much and frivolously spend our tax dollars. They will borrow $200 million to build a bridge to nowhere.

Tom Coburn is the only one who can save us.

This is why oil is $98 bbl, investors are dumping USD and buying oil futures, not like they can invest in toxic debt anymore.

[BOUGHTONII]

and now comes the greatest depression, but on the bright side a new world war has been primed

[abudabit]

LONDON (AFP) - The dollar hit a new record low against the euro on Thursday, provoking more worries in the eurozone about the impact of the soaring European currency.

Europe's single currency stuck a record peak of 1.4875 dollars in Asian trading hours -- the highest level since the euro's creation in 1999.

Later in European trade, the euro stood at 1.4850 dollars, compared with 1.4854 in New York late on Wednesday. US markets were shut Thursday owing to the Thanksgiving national holiday.

The dollar also hit an all-time low against the Swiss franc, which is viewed as a haven in troubled times for the global economy. The US unit fell to a record low of 1.1005 Swiss francs.

Markets were still digesting Tuesday's downbeat US growth forecasts from the Federal Reserve. The economic expectations have weighed heavily on the dollar, despite the Fed insisting it has no plans to cut US interest rates again in the coming months.

"With investors still exploring the extent and duration of the US economic downturn, it is no surprise markets are not subscribing to the idea the Fed is reluctant to cut too far," said Gavin Friend, currency analyst at Commerzbank.

The Federal Open Market Committee slashed its base federal funds rate by a half-point to 4.75 percent on September 18. It was the central bank's first rate cut in four years.

That rate cut, and a subsequent quarter-point reduction to 4.50 percent on October 31, were taken to ease a credit crunch related to the US housing slump.

German Chancellor Angela Merkel said Thursday that the euro's record levels against other major currencies "naturally poses problems" for exporters, the traditional engine of German growth.

"We are happy of course to have a solid currency. But for exports it naturally poses problems," Merkel told television news channel N24.

Earlier Thursday, the German head of European plane maker Airbus, Thomas Enders, said the group might have to take new cost-cutting measures to counter the euro's rise against the dollar, which he said had "exceeded tolerable limits."

Airbus expects "enormous losses" from foreign exchange effects, Enders said.

The dollar was also suffering from growing speculation that overseas investors may diversify from the US unit and turn increasingly to the euro.

The euro has "benefited from heightening expectations that Gulf Arab states and Saudi Arabia will revalue their currencies and introduce a basket to replace the dollar peg," said NAB Capital strategist John Kyriakopoulos.

Saudi newspaper al-Riyadh reported that Saudi Arabia may have started considering a revaluation of its riyal against the dollar ahead of a meeting of heads of Gulf Arab states in early December.

Elsewhere, market participants were worried the greenback could go into free-fall against the Japanese unit, even to the 105-yen level, dealers said.

But they do not expect the Japanese central bank to intervene in the near term to rein in the stronger yen, which is hurting Japanese exporters.

"There is no longer any emotional attachment nor aversion against the yen's appreciation among Japanese politicians and corporate executives which we saw a few years ago," said Toru Umemoto, chief forex strategist at Barclays Capital.

The US central bank on Wednesday trimmed back its growth projections citing weakness in housing and tighter credit conditions.

The Fed projected growth next year in a range of 1.8 to 2.5 percent, down from a prior forecast of 2.5 to 2.75 percent.

In late European trade Thursday, the euro changed hands at 1.4850 dollars, against 1.4854 late on Wednesday, at 161.10 yen (161.02), 0.7208 pounds (0.7190) and 1.6358 Swiss francs (1.6366).

The dollar stood at 108.49 yen (108.38) and 1.1016 Swiss francs (1.1016).

The pound was at 2.0600 dollars (2.0650).

In London, the price of gold rose to 803.25 dollars per ounce from 798 dollars late on Wednesday.

Slipping against the Yen would be significant since that is the one major currency that was riding alongside the dollar during this decline.

[Xyn]

I yen for a stronger dollar.

LINGER LONGERRR

[sniper2323]

Well, I believe that the U.S. has become a service style economy. We produce very little. More production jobs have moved out of our country. By extream regulations, taxes, etc. We have saved our country from all the bad things in the world, till we get taken over. What is sad, and do some research on this one kids... We have a milk cow, If I were to sell or give raw milk, that is not inspected, I would serve more jail time then if I sold drugs. That is stupid. We are so wrapped up in saving the poor and saving a spotted owl, and of the poor deer, that everyone suffers. Where I live, logging is a large part of our $$$. Nafta Messed that up, along with the eco-wackjobs, that 2 sawmills closed in our small town. But Canada is shipping lumber through our town day in and day out. Cattle, pigs, sheep, etc. are shipped down all the time. Hey, atleast we helped our great friends to the north that is dumping animal crap down our roads because they want thier trailers lighter to cross the truck scales.

I will not vote for anyone who wants open borders. We need to get back into production at home, so we don't have to buy from elsewhere.

Sorry for the rant.

[norton23]

the "diharrea" will be the official bill of the mexicans

[d0uche_n0zzle]

Planet of the Apes coming sooner then expected....