Greenspan suggesting to Gulf counties to unpeg from the dollar: http://www.reuters.com/article/businessNews/idUSL2515874520080225

Am I alone in thinking this would be catastrophic for the dollar? What do we really have left propping it up, other than oil?

Now we have the dollar at all time lows against the Euro: http://finance.yahoo.com/currency/convert?from=USD&to=EUR&amt=1&t=5y

Compared to the Euro, $1,000 five years ago would only be worth ~$735 today. Considering we import the majority of what we buy, this relative devaluation is what really matters, not the synthetic benchmarks the FED uses to measure inflation.

Speaking of that, it's even worse that we're losing vs. the Yuan: http://finance.yahoo.com/currency/convert?from=USD&to=CNY&amt=1&t=5y

We've only lost 12% there so far, but the trend is scary, considering how much we depend on imports from China.

We see the DOW regaining some of it's losses (with a lot of volatility) lately, but that's meaningless relative to the devaluation of the currency that it's measured in (dollar). Your mutual funds and 401ks are showing increases by walking up the down escalator, and going down in the end.

This stuff should make people mad. Our monetary policy is wiping out billions and billions of peoples' savings and retirement funds. People on Social Security are getting tiny increases based on that synthetic inflation benchmark, but those increases are nothing compared to how much the dollar is actually devaluing.

Hilary vs. Obama vs. McCain is really meaningless in the face of this. None of them will do a thing about the FED and how screwed we are. They need to be brought to task about these fundamental threats to our entire economy, not fluff talk about universal health care.

Thoughts? Personally, I'm going to diversify some of my savings into gold and silver this week.

This (http://this/) stuff should make people mad. Hilary vs. Obama vs. McCain is really meaningless in the face of this. None of them will do a thing about the FED and how screwed we are. They need to be brought to task about these fundamental threats to our entire economy, not fluff talk about universal health care.

First off we are too passive to get mad...lol

Second...it is never the president's fault that the economy is going down the toilet..lol

Third....politicians only talk about what they want to us to change. They need to talk about it alot so we get used to it so we will say yes to it and feel it is the right thing to do when the vote for it comes up. Advertisement works wonders in conviencing a large population. :(

Getting our money out of the dollar maybe is not a bad idea.

My girlfriend's dad worked for the world bank and they both are Irish citizens, and despite living here they've kept most of their savings in banks back in Ireland to keep Euros. She's encouraged me to keep a bank account in Ireland in Euros to not be hit as hard with this whole mess.

That being said, its not that bad. We've had economic downturns before, tons of them. The Euro isn't bulletproof and they'll have their own fair share of problems, especially as more and more countries sign on. OR we'll go to a universal currency (which wouldn't be a bad thing in a global economy).

If the OPEC states unpeg from the dollar, I fear we're looking at the worst it's been since the Great Depression.

You know, maybe the dollar falling flat on its face is what we need. It might be just what we need to reboot to our economic system. Maybe we'll end up in a situation where we're less reliant upon imports and shit starts to get produced locally again.

Ah, what do I know? All I know for sure is when the shit hits the fan, make sure you have plenty of canned goods, a large garden and plenty of ammunition. ;)

If the OPEC states unpeg from the dollar, I fear we're looking at the worst it's been since the Great Depression.

Im not an economist, but the reason the dollar has been so incredibly stable, even to the point that nations going through monetary instability (for example argentina) used to stock up on it, is more or less completly due to OPEC trading exclusivly in it, and if they would drop it in favour of the euro, it could indeed spell disaster. I have no idea what ramifications this would have for the world economy though. :rolleyes:

Exactly. For a long time now, our most important export has been dollars. Worldwide demand for it has been rooted in oil trade, insulating it from most instability.

Iraq dumped the dollar for oil trade and got attacked almost immediately afterward. Iran did the same recently and suddenly we're on the verge of going after them next.

That's no coincidence.

Get back to the pound Sterling.

It makes even the Euro look sluggish and fragile.

The Canadain dollar has been just under, at parity or over parity with the U.S. dollar for months now. As I write this the Canadain dollar is basically at parity with the U.S. green back (1 Canadian dollar = 1.008166 U.S. dollars).

A article just today in the Globe and Mail talks about the Loonie, U.S. greenback and the Euro:

http://www.reportonbusiness.com/servlet/story/RTGAM.20080227.wloonie0227/BNStory/robNews/home

Its not that the Canadian dollar is blowing away its U.S. counterpart its more due to the fact that the U.S. dollar is falling flat on its face globally.

Most statble economic environments are unpegging the U.S. dollar and reverting to the gold standard or if they are confident enough, to their own currency.

The worst predictions we are getting up here on the U.S. economy is that you are headed to stagflation like what occured in the 70's.

From http://www.reportonbusiness.com/servlet/story/RTGAM.20080227.wbernanke0227/BNStory/robNews/home:

With the economy slowing and prices rising, fears are growing that the country could be headed for a bout of stagflation, a dangerous economic brew not seen since the 1970s.


One upside (not for Canadians, but for U.S. companies) to your falling U.S. dollar is that manufactuing companies in Canada are pulling up stake and heading to the U.S. for the cheaper overhead. Its an incredible one-eighty from the situation up here over the past 20-30 years of U.S. companies breaking ground to produce products for the U.S. market at cheaper prices.

There are a lot of factors biting you (the U.S.) in the ass right now as far as your economic situation goes:

- the war(s)
- the housing market and the high-risk mortgage scenario (which looks like a big mushroom cloud from my vantage point)
- overspending and mass borrowing from individuals in the U.S.
- massive borrowing from the likes of ecomonies like China to fund said war(s).
- a disconnect in the Feds ability to make sound moves to protect the U.S. economy from shooting itself in the foot.

I admit I may be naieve on some of the points above, please dismantle them as you see fit but for the most part I think they are valid points.

One thing I know for sure is that the U.S. HAS to come to terms with its need to over spend weather it be on its war(s) or huge plasma screen tvs.


Cheers,

Not much to add but that this started with a snowball at the top of the mountain about 3 years ago (at least when I started noticing) and has been building into an avalanche since. How much further to the bottom?

Depends how much longer the Fed keeps dropping interest rates to further devalue the dollar before they decide to let the inevitable run it's course and pick up the pieces after.

The real irony is that the lower it goes, the tougher it is for China and the like to stay competitive on goods and we might see US manufacturing headed back up soon.

Depends how much longer the Fed keeps dropping interest rates to further devalue the dollar before they decide to let the inevitable run it's course and pick up the pieces after.

I don't see that happening. Bush doesn't want to leave office with the economy in the toilet, so the dropping rates are vital.

Kelraz, that is exactly what I was thinking in my blue sky scenario. I'm willing to bet that nothing that good will come of this, though.

This whole mess makes me wish I had bought a house I couldnt afford. Maxed out equity credit lines on it. Bought a houe I could afford and fixed it up really nice paid off my car boat and credit card. Then file bankruptcy on the big house and be sitting pretty while the rest of the economy tanks.


Sad but its what alot of americans have done even if the thought of bankruptcy wasnt the original intention. Pisses me off. but such is life. Ive talked to many who have done just as I said when I remodeled ther home.

Depends how much longer the Fed keeps dropping interest rates to further devalue the dollar before they decide to let the inevitable run it's course and pick up the pieces after.
I think it's important to remember that the Federal Reserve is no more part of our government than Federal Express. Our best interests typically align, but not always.

For example, it derives significant income from foreign currency investments. It also makes massive profits from creating money out of thin air to lend to banks, which is increased when rates drop.

The FED directly profits from these waves of inflation that it causes.

While it is technically subject to Congressional oversight, the FED is also one of the most powerful organizations on Earth. Most of our Congress is interested in steroid use in baseball, not taking on the guys who ultimately sign their paychecks.

The real irony is that the lower it goes, the tougher it is for China and the like to stay competitive on goods and we might see US manufacturing headed back up soon.
Unfortunately, it would take too much capital, skilled labor, and time for that to happen. It may be something that happens over the years, as things come back to equilibrium, but not in the near future.

It might help ease outsourcing of industries that are already running (IT, legal, call centers, etc), but our manufacturing industry is too dormant to ramp back up quickly.

Basically, if we don't save our current dollar/service economy, we're in for it.

I don't see that happening. Bush doesn't want to leave office with the economy in the toilet, so the dropping rates are vital.
Bush doesn't have any real control over the rates. Nothing will turn the economy around before he's out anyway. Sub prime defaults alone will continue to increase until at least the end of '08, due to when the original loans were made and are due to mature.

It's going to get much worse before it gets better. There's just no way around that.

Sad but its what alot of americans have done even if the thought of bankruptcy wasnt the original intention. Pisses me off.

Your scenario isn't as easy as it sounds, also the number 1 reason for bankruptcy filings is medical bills not mortgages which in fact are very low on that totem pole.

Just when I thought I had a boat full of retirement money I have to start worrying about its becoming useless. Now on top of that a major portion of this country doesn't save for retirement, means they even have less. We could be the new Africa when retirement hits...no money and lots of guns.

Don't hold it all in dollars (or dollar investments).

Majority of bankruptcies are due to medical bills true, But there are a large portion from day traders, house flippers and your gamblers. To think people werent playing the housing market and the easy credit accompained from it is niave. Loans made without so much as a pay stub pushed this issue.
The big banks arent crying to much Country Wide is bieng bought out with there losses bieng used as tax right offs after the US helping to bail them out to the tune of 50 billion. The Purchaser BoA can write off 150 billion in taxes while writing off countries losses. Citi bank isnt crying foul either there bing bought up and invested by foriegn banks and oil rich nations. wtf is that ???http://articles.moneycentral.msn.com/Investing/Dispatch/071126markets.aspx


Foriegn dollar increases killing the us dollar is a look back to 20 years when the Japanese where buying up all the skyskrapers. with the US even bailing out people who bought more than they can chew How can you feel not rewarded for bieng stupid and punished for living within your means.

Majority of bankruptcies are due to medical bills true, But there are a large portion from day traders, house flippers and your gamblers. To think people werent playing the housing market and the easy credit accompained from it is niave. Loans made without so much as a pay stub pushed this issue.
The big banks arent crying to much Country Wide is bieng bought out with there losses bieng used as tax right offs after the US helping to bail them out to the tune of 50 billion. The Purchaser BoA can write off 150 billion in taxes while writing off countries losses. Citi bank isnt crying foul either there bing bought up and invested by foriegn banks and oil rich nations. wtf is that ???http://articles.moneycentral.msn.com/Investing/Dispatch/071126markets.aspx


Foriegn dollar increases killing the us dollar is a look back to 20 years when the Japanese where buying up all the skyskrapers. with the US even bailing out people who bought more than they can chew How can you feel not rewarded for bieng stupid and punished for living within your means.


It is the responsibility of the lender to compile accurate financial data on who they are lending to. It is their responsibility to look at the debt to income ratio of the borrower. They failed miserably in this and it was purposeful the way they went about these mortgages.

To think that the responsibility for this situation rests on the shoulders of the consumer is ridiculious, it is 100% the fault of the banks, mortgage brokers and financial institutions.

If there is not a bailout or a moratorium, to allow people to either get on track or sell their house and get out from under it, it will have very negative effects for EVERYONE in this country no matter if you lived above or below your means.

People need to show some compassion and get on board with this or they too will receive the economic fucking of their lives.

Don't let the banks kid you, they don't lose two cents on a foreclosed mortgage.

I don't see how you can possibly excuse the consumers of their responsibility here. Don't buy something you can't afford. How is that complicated?

For decades, credit card companies have been pushing more credit on people than they can reasonably repay, to make endless profits on interest. Should we bail out the poor, outwitted consumers who bought plasma TVs they couldn't afford?

Same thing.

Also, don't forget that the other end of these mortgages are ultimately in a lot of regular types' 401k investments. Screwing over the banks isn't just sticking it to the man. This mess ends up playing out in a lot of middle class stock portfolios (a la Enron and Worldcom). Bailing out the irresponsible home buyers only exacerbates the burden on the rest of us.

Speaking of:

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I don't see how you can possibly excuse the consumers of their responsibility here. Don't buy something you can't afford. How is that complicated?

For decades, credit card companies have been pushing more credit on people than they can reasonably repay, to make endless profits on interest. Should we bail out the poor, outwitted consumers who bought plasma TVs they couldn't afford?

Same thing.

Also, don't forget that the other end of these mortgages are ultimately in a lot of regular types' 401k investments. Screwing over the banks isn't just sticking it to the man. This mess ends up playing out in a lot of middle class stock portfolios (a la Enron and Worldcom). Bailing out the irresponsible home buyers only exacerbates the burden on the rest of us.

It's about debt to income ratio, it's a rule of lending that a bank MUST go by. If a bank pushes a loan or line of credit on a consumer and so decides to make that loan while ignoring the debt to income ratio it is the fault of the bank.

most people have no understanding of debt to income ratio and it is also the law that this be explained to the consumer, unfortunately the banks also failed to do that.

It's too bad this whole thing isn't about plasma tv's, it's unfortunate it's about the lives of families...the scary part is...it could happen to everyone.

Also, are you blaming the Enron and Worldcom train wrecks on the consumer?

It is the responsibility of the lender to compile accurate financial data on who they are lending to. It is their responsibility to look at the debt to income ratio of the borrower. They failed miserably in this and it was purposeful the way they went about these mortgages.

To think that the responsibility for this situation rests on the shoulders of the consumer is ridiculious, it is 100% the fault of the banks, mortgage brokers and financial institutions.

If there is not a bailout or a moratorium, to allow people to either get on track or sell their house and get out from under it, it will have very negative effects for EVERYONE in this country no matter if you lived above or below your means.

People need to show some compassion and get on board with this or they too will receive the economic fucking of their lives.

Don't let the banks kid you, they don't lose two cents on a foreclosed mortgage.

I just bought a house for $317,000 with an average income over the past 3 years at $38,000 ($19k, $40k, and $55k earnings so my company is obviously doing better each year, but they average your past 3 years) . I was actually kinda floored that I wasn't asked to have any co-signer. The reality is if I was making $38k a year ($3,170 / month) there's no way I could make the $2,200 / month mortgage payments (to be honest if I was only making $55,000 a year or $4,583 / month before taxes I'd have a hard time paying it) - but they were happy to lend to me anyway. They even offered a variable interest rate or 7-year interest only loan as my first two options despite everything that happened. I'm fairly confident Rover's last sentence is more often than not right on the money.

Though the last purchaser of my house paid $429,000 and was foreclosed on 6 months later, then it sat on the market for 6 months before I bid $307,000. Its safe to say they lost a few bucks there.

I am happy with my $144,000 house and 30yr fixed interest rate.

I'd love to see my wife and my debt to income ratio right now, it can't be too high. $700 in credit card debt, ~$30,000 in school loans, about $120,000 left on the house, wife's car paid off, mine is a lease.

I know I'm leaving out the most important factor of our combined income, but no reason really to post that here.

Yeah, honestly if I didn't rent out 2 rooms I'd be having a shit ton of problems. They never considered that when they sat me down to say "here's what you can afford". There is no way someone making $38k can afford $2200 / month, yet they'll loan you the money anyway.

I was also surprised that even with a new mortgage, I can still take out as many credit cards as I want.

Yeah, honestly if I didn't rent out 2 rooms I'd be having a shit ton of problems. They never considered that when they sat me down to say "here's what you can afford". There is no way someone making $38k can afford $2200 / month, yet they'll loan you the money anyway.

I was also surprised that even with a new mortgage, I can still take out as many credit cards as I want.

This is part of the problem. B/C people do this and then can't pay and it's just a vicious cycle that will not end well.

I'd be lying if I said I wasn't worried about our economy. I'm very worried. I don't think rate cuts or rebates are the answer, I think they are bandaids and I think we're making things worse. I don't know the solution but I also don't think any candidate can help this. I almost think it's going to take a drastic event to wake people up.

Leah and I were examining our energy bills from 2 years ago at this time. Last year we paid $86 for the month of Feb for electric. Last year we paid $129, this year we paid $158. Those are significant increases and we can show similar examples in groceries and gas. Other utils have gone up as well except for telephone. How long until average working Americans can't keep up with this trend of increases?

I don't know the solution but Ron Paul is the only candidate that can help fix this.
Fixed!

Only if he'd be able to get people to work together, much like people's arguments against Obama.

Even as dumbed down as we are, I'd like to think him explaining to people how the FED is stealing money right out of our pocket would get them united. Not to mention, who the hell isn't for ditching the IRS?

Some fiscal responsibility at the top could be just what we need to turn our spending problems around.

Thank God!

Bush says country not headed into a recession (http://www.twincities.com/ci_8392537)

Apologies if this requires free registration. Not sure if it does.

Here's the transcript from that committee with Bernanke:

http://www.washingtonpost.com/wp-srv/business/documents/bernanke022708.html

Search on that page for "history is against you". I just can't help but think that if Ron Paul could be given an uncensored, mainstream outlet to say that to the American people; at least some of them would wake the fuck up.

Some high points:

And that is why the conventional wisdom is everybody refers to inflation as rising prices instead of saying inflation comes from the unwise increase in the supply of money and credit.

And when you look at it -- and I mentioned in my opening statement that M3, now, measured by private sources, is growing by leaps and bounds. In the last two years, it increased by 40, 42 percent. Currently, it's rising at a rate of 16 percent.

That is inflation. That will lead to higher prices.

So to argue that we can continue to do this, continue to debase the currency, which is really the policy that we are following is purposely debasing, devaluing a currency, which, to me, seems so destructive. It destroys the incentives to save. It destroys -- and if you don't save, you don't have capital.

Then it just puts more pressure on the Federal Reserve to create capital out of thin air in order to stimulate the economy. And usually that just goes into malinvestment and misdirected investment -- into the housing bubbles or the Nasdaq bubble.

And then the effort is, once the market demands the correction, what tool do you have left? You have to keep pumping, pump, pump, pump. And it just is an endless task. And history is against you.

I mean, history is on the side of hard money. If you look at stable prices, you have to look to the only historic sound money that's lasted more than a few years.

Fiat money always ends. Gold is the only thing where you can get stable prices.

For instance, in the last three to four years the price of oil has tripled: a barrel of oil, from $20 to $30 up to $100 a barrel. And yet if you look at the price of oil in terms of gold, it's absolutely flat; it's absolutely stable.

So if we want stable prices, we have to have stable money. But I cannot see how we can continue to accept the policy of deliberately destroying the value of money as an economic value. It destroys -- it's so immoral in the sense that, what about somebody who's saved for their retirement and they have C.D.s, and we're inflating the money at a 10 percent rate? Their standard of living is going down.

And that's what's happening today.

The middle class is being wiped out and nobody is understanding that it has to do with the value of money. Prices are going up.

So, how are you able to defend this policy of deliberate depreciation of our money?

That was an interesting but long read Sanchek. I think Paul makes some very good points. I think quite a few people made some good and valid points. In reading that I can't help but feel like Bernake was a little disconnected... I mean it's like he wanted to say yes yes yes I agree with you but for some reason he couldn't. And man did Paul rip him up when he tried to downplay the dollar decline as a Treasury problem.

Ron Paul has been on top of this for some time now. Here's another from a year ago:

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Ron Paul has been on top of this for some time now. Here's another from a year ago:

A4kxTkhwR_Q


As much as I like Obama, it wouldn't be to bad of an idea to bring Ron Paul into an administration or as the head of an agency.

As much as I like Obama, it wouldn't be to bad of an idea to bring Ron Paul into an administration or as the head of an agency.
He'd then get rid of the agency and be out of a job, though.

If he got rid of the IRS, I don't think anyone would mind (Except the IRS).

He makes some damn good points about the FED and how Congress can't govern that which it did without really having the power to do so in the first place.

You know it's bad when: http://www.blogmaverick.com/2008/02/29/when-will-foreign-ownership-of-us-sports-teams-start/

Please God let them buy the Redskins. Anyone but Snyder.

Why is this such a shock? The dollar is the reflection of what our economy is worth in relationship to the world.

The United States doesn't manufacture much of anything. US flags are made in China for christ sake. All we do is resell merchandise now which originated in asian sweatshops. Walmart, the biggest "Made in USA" banner waver has more or less become China Depot now.

So, where did all those high paying manufacturing jobs go?

The US can't make a decent car to save its life. Even if the car is mechanically mediocre, good chance its so ugly or boring compared to others in its price range, no one will buy it. SUVs are dying a slow death thanks to the US paying the real cost of oil.

We have to buy over 50% of our uranium to fuel power plants from Russia, and yet we have enough nuclear fuel tied up in weapons to keep the lights on for a very long time.

It took a Spanish firm to build a viable solar power plant in Arizona. That should have been almost common sense for the folks that actually live in Arizona.

Our own Air Force decides that the KC45 tanker should be Airbus based, because they simply offer a better product for the money compared to to Boeing's 767 based variant.

I am in the US military, and I feel I have the best job in the US given the current state of affairs since I work in the US's top industry: War. Plenty of job security, a steady check, etc. I have no idea if that is something to be proud of or ashamed of.

We invaded Iraq because Saddam threatened to peg oil sales on the Euro, thus causing all other OPEC nations to follow suit and making the dollar as economically viable as the peso. Perhaps even less since Mexico actually manufactures things. Guess what? Its happening anyway.

Americans don't know how to save money and plan for tomorrow anymore. Our own government encourages living beyond our means. The governement does it. You should too. Trillion dollar debt FTW.

Speaking of Mexico, if it were not for Mexican illegal slave labor, the one last bastion of American can do productivity would crumble: Agriculture. China of course is poised to take the crown in that too, since all their slave labor is home grown.

Oh and China, which runs things like a giant Sim City game, able to plop down Dubai-esque economic power house megacities virtually over night thanks to deep pockets and the stream lined decision making that only authoritarian governements of homogenius cultures seem to do well, can out maneuver us every step of the way since they have the money to do so and don't have to wade through the red tape of who will be offended and sue us for making a tough decision. Appeasement: That is the status quo here in the good ole' US of A. Better that we starve then offend a special intrest group or some obscure minority.

Who is trillions of dollars in debt again? Oh the United States.

Thats just a sampling. So yes, unless we seriously unfuck ourselves and find a way to compete with the likes of China or perhaps find a way to co-exist with a Chinese lead planet while still somewhat maintaining a decent lifestyle... then good on us. Honestly, at this point, people are more than willing to cash in all their freedom for peace of mind, as American branded Democracy is NOT offering what it used to on the global scale. Eventually, the US war machine will find that it too can't pay for itself anymore, and even us soldiers will be out in the cold. Best use your GI Bill, fellow service members. You are going to need that degree!

Which is exactly how the rest of the world works. Please correct me if this post is grossly negative and missing the point completely. Considering some of you beleive 9/11 was a government orchestrated conspiracy....

On the bright side, China is now pegged to take the blame for global warming. Woot.

Long story short, the dollar is a solid reflection of how we just feel good things will come our way just by default because, by golly, we are Americans and we expect it. Well, it takes hard work, sacrifice, sound leadership, flexibility, long term planning and innovation. Perhaps all that is now currently lacking, and our currency reflects it in spades.

Nicely stated rant Lumm. Keep your powder dry and your bores oiled folks it may be our only hope.

We could be the new Africa when retirement hits...no money and lots of guns.

I was thinking that same thing.
While we have civil unrest...will that make us vulnerable to those outside of the US? Oh the webs we weave...bleh

Heh, watch this guy get beat up, while he tries to explain it all the way back in 2006.

LfascZSTU4o

(Note: He's a Ron Paul supporter. Go figure.)

Why is this all so hard to understand? I wonder how much crow that guy is eating now?

Wow. Thats a good find.

http://www.bloomberg.com/apps/news?pid=20601109&sid=aIbnAuYWv3A0&refer=exclusive

The yield on the five-year Treasury Inflation-Protected Security due in 2012 has been negative since Feb. 29, and traded today at minus 0.17 percent. The notes, which were first sold in 1997, have never before traded below zero. Even so, firms from Deutsche Asset Management to Vanguard Group Inc., the second- biggest U.S. mutual fund company, say TIPS are a bargain.

Investment firms are expecting inflation to be so bad that they see a negative yield, adjusted for inflation, as a great deal.

The situation (http://www.cnbc.com/id/23629967) according to former National Bureau of Economic Research President Martin Feldstein:
"The situation is very bad, the situation is getting worse, and the risks are that it could get very bad," Feldstein said in a speech at the Futures Industry Association meeting in Boca Raton, Florida.
Yesterday, Bear Stearns had (http://www.reuters.com/article/bankingFinancial/idUSN1217286920080313) "$17 billion or so excess cash on the balance sheet," according to Chief Executive Alan Schwartz. Today, Bear Stearns is getting a bailout (http://biz.yahoo.com/ap/080314/bear_stearns.html) due to "significantly deteriorated" coffers and losing "half of its value within 30 minutes of the market open."

Now that's volatility.

Gold hit $1,008 for a bit today.

I like gold as much as I like foreign currency. That meaning the two combine to 95% of my investment portfolio.

I worry that foreign currencies are as prone to a crash as the dollar is. They'd be good to ride up for awhile, but not to hold in a long position.

Speaking of gold, silver might actually be the huge opportunity for now.

Speaking of gold, silver might actually be the huge opportunity for now.

/sigh

Sanchek, you know Halo is going to run with this, right? :rolleyes:

And down goes Bear Stearns, bought by JP Morgan at $2 per share. Bear Stearns encouraged employee investment and payment of stock options to its 14,000 employees, who reportedly owned about 1/3 of the company. The Fed is lending a helping hand (http://biz.yahoo.com/bw/080316/20080316005053.html?.v=1).
In addition to the financing the Federal Reserve ordinarily provides through its Discount Window, the Fed will provide special financing in connection with this transaction. The Fed has agreed to fund up to $30 billion of Bear Stearns’ less liquid assets.

Duh: http://emac.blogs.foxbusiness.com/2008/03/26/time-to-listen-to-ron-paul/

Ironic, coming from anything even remotely connected to Fox.

The administration needs to state more emphatically that it supports a strong dollar. A stronger dollar would draw liquidity back into the credit markets, lower inflation risks, cut oil prices and restart economic growth, notes Bear Stearns economist David Malpass.

oops! I wonder if Mr. Malpass still has a job? Though the statement is generally correct.

One thing that the weak U.S. dollar is going to reveal by inflation is the cost of goods and services many of us in the rest of the world have been paying for decades.

Your goods and services up until now have been much cheaper to afford than say Canada or Europe. Thats all going to change as your inflation goes through the roof.

Printing money won't solve the U.S. long term woes, its a short term fix to try and get the derailment back on the tracks, only to be subjected to another derailment down the line if successful.

Get some tighter controls in on the U.S. market so you reduce the amount of greedy investors shooting the economy in the foot. Reducing the amount of wars you have should help too.

Cheers,

Overall I think if we'd truly adopt free trade and apply tarriffs on countries that refuse to take their tarrifs off of our goods we'd see a bit more stability.

I agree we can't just print money, that's a huge short term mistake ;(

Nice and simple:

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Good video, until the guy tells the viewer to go rate the video.

Working today for Kipplinger Financial and been reading their recent "Kipplinger Letter" which is their letter to big business types like CEOs and CFOs. This weeks topic is discussing the next bubble burst. Apparently the commodities markets (like that gold and silver) are skyrocketing much like the housing market was and the "India and China demand" argument doesn't seem to add up to the numbers and more are an excuse the companies are using to increase their prices 25 to 50 percent in some cases just a year. I'd be careful putting cash into gold because like any bubble it'll burst and they really outlined how they see it happening in the next year following the election. However this should help normalize prices some on goods that keep jumping.

You happen to have the letter and the ability to scan it and post it?

Best I can do is take a picture with my cell phone. I don't pay the X number of hundreds of dollars to subscribe :(
It'll probably make it to their website in a week or two, I'll keep an eye out.

That being said their website is awesome. What we are shooting today is 35 2 min videos about various financial tips and I've done 115 of these in the past. Helped me save for, shop for, and buy my house as well as plan and shop for my retirement IRA.

Keep in mind these are the same sort of people who told you to invest in Bear.

No financial institution in the world would support gold. The IMF actively dumps gold when the price rises, to keep it deflated. They need you on currency that's based on debt, or they go out of business.

That said, I wouldn't view gold as some magic investment either. I simply see it as a hedge against inflation. That happens to make it a great investment, compared to holding dollars or your typical mutual fund, these days, but that's just due to our massive inflation over the past few years.

So what happens to the IMF when the world goes to hell in a handbasket and can no longer dump their gold into what's left of the global economy? Would gold not then be useful as a safety net?

It dropped alot in the 80s after the savings and loan scandel makes since that it will again after all these banks bail out off the tax payers dollar on the bad paper bail out of 08.

Taleren or anyone else asking for it: http://www.kiplinger.com/businessresource/forecast/archive/commodity_prices_near_turning_point_080409.html

(note: This isn't the actual letter, but an article derived from some of the same content by the same author)

So what happens to the IMF when the world goes to hell in a handbasket and can no longer dump their gold into what's left of the global economy? Would gold not then be useful as a safety net?
That makes a lot of sense in a sane system.

However, if you're part of the central banking system and can generate endless money, why in the world would you limit yourself to tangible assets like gold? Dumping it on the market to help keep your monetary system popular is much more profitable.

It dropped alot in the 80s after the savings and loan scandel makes since that it will again after all these banks bail out off the tax payers dollar on the bad paper bail out of 08.
It just fluctuates with the currency. Gold itself isn't something that goes up and down much at all.

The bailout happening now will devalue the dollar further, making gold worth more and more of the inflated dollars. You see the gold price going up, but really that's just a measure of how much all of our money is being devalued.

An interesting article (commentary, really) from Der Spiegel today about the Fed's paradoxical attempt to lash the banks into continuing to lend, and consumers into continuing to spend, in the wake of the meltdown both of the mortgage industry and the dollar:

http://www.spiegel.de/international/business/0,1518,547317,00.html

As someone who, despite hardly living an extravagant life heads a single income household, lives more or less hand-to-mouth, and has debt that has been slowly accumulating since my divorce (11 years ago, I'm trying to pay it down now), I'd have to say I'm worried, but more so for my parents, who are both in their late 60s, facing retirement, with a house that has recently been refinanced, three leased cars (one for my sister) and retirement plans in serious jeopardy. There's no question that we are in for a rough ride indeed, and I'm glad that I have most of my retirement (such as it is) in a guaranteed (albeit low) return fund (transferred there when I left a previous employer) and oil and gas, although I need to look at it again.

Regards,
Nydia

Good thing I have a bit of bought silver (physical). I always though silver better than gold.

But what do I know, I'm just juggling through life like everyone else, except im not in debt, and have a good job - about go get my own shop up.

Thing is, since the 60s, this country has been turned into a consumer. Thats how the US was set up since that era, and while the US soaked that up, looks like it got tied pretty bad with the economy.

US consumes a giant portion of the worlds resources. It looks like that high has burst, now it's time to start paying what those resources are really worth.

I can go on and on...

http://www.thedailygreen.com/environmental-news/latest/oil-gold-commodities-47041507

This "economic loop of madness" is terrifying.

I read that crude oil barrel price broke a new record (over $114), like everyday nowadays, because dollar was going down, because there are some issues with several oil suppliers (Mexico has its weather problems and Nigeria has fires), and because investors are afraid of the dollar's fall possible inflation!!

It's like cutting one of your foot to eat something without questionning how you will hunt your next meal.

Who cares about tomorrow, I have a foot to eat.

Funny article, some true:
http://www.aljazeera.com/news/newsfull.php?newid=85606

Whats funny is where it's published.

AlJazeera sidebar:
They're one of the biggest news outlets in the world and have a very, very large bureau here in Washington. When they opened the bureau they grabbed people from CNN, MSNBC, Fox, BBC, etc. My best friend works at the Pentagon and does defense intelligence; he reads Arabic and its part of his job to watch their programs daily. He says their Arabic feed is generally the same as their English feed just targeted after different countries. I'll watch AlJazeera English time to time to get a more worldly view of the news, much like if you were watching BBC or SkyTV.

They get a bad rap because of the Osama videos they aired, but thats because thats the network he sent them to first. It would be like if Timothy McVeigh never was captured and made videos discussing the bombing - he probably would have mailed them to CNN. Its not like its a pro-terrorism network or anything, just here in the US we suffer from the narrow minded assumption that since they speak Arabic they must be evil. Hell, the country of Qatar where AlJazeera Arabic is based out of is a major US ally and was the base of operations for our invasion of Iraq in 2005.

Nice little article on MSN today about $180 barrel oil in the near future possible months. Makes me cringe to think about, costs of goods and services are already escalating. I think this would send alot of business into bankruptcy and leave alot of people without jobs.

5.50 a gallon for gas http://articles.moneycentral.msn.com/Investing/JubaksJournal/WhyOilCouldHit180DollarsABarrel.aspx