A blend of risks makes dollar's outlook grim

http://www.iht.com/articles/2005/03/27/business/dollar.html
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Is the writing on the wall for the U.S. dollar? Researchers at one big fund manager say it is, but the markets haven't read along just yet.

Since the start of March, Bridgewater Associates, a manager of more than $100 billion of institutional and hedge fund money based in Westport, Connecticut, has been issuing warnings in its daily reports. One on March 11, titled "The Breakdown of the Dollar System," said, "As we often say, we've seen this movie many times, and we know the ending."

There is indeed a volatile blend of risks surrounding the dollar.

President George W. Bush's new budget proposal would substantially expand the government's debt burden in the next decade, potentially raising doubts about the desirability of its IOUs. Some Asian central banks have declared that they will diversify their reserves away from dollar-denominated assets.
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Bridgewater says it believes that the dollar is already beyond the point of no return. To keep the currency at its current value, private investors will have to buy more American securities as central banks desert them, said Robert Prince, the firm's co-chief investment officer. Before private investors will act, they need to see a higher return from American assets, relative to assets carrying similar risks abroad.

very important info...here we go.

Here we go indeed...
the ONLY bright spot in the future is
looking forward to the moment the Bushbots
realize what they blindly brought upon themselves
by their "true believer" support for the devil and his minions.
BHN

is what flattened so many of us starting in late 1978. There was no commensurate rise in wages, and wages still lag far behind wages in the early 1970s in terms of purchasing power.

During periods of high inflation, savings represent a net loss in purchasing power. During periods of high interest rates, investing in industrial stocks represent a hope for the future, not earnings power in the present, and can also represent a net loss in purchasing power.

Gold has been the one sure hedge against inflation in the past, simply because its value in purchasing power follows both inflation and deflation. The problem is finding a buyer when you need groceries.

This go-round with economic disaster will be unlike that in the late 1970s as we have been hemorrhaging jobs for over 3 years, and this trend is likely to increase, rather than decrease. Eventually we'll reach a tipping point in terms of strangling the consumer economy, and it remains to be seen whether we'll have a deep recession or go all the way to depression, dragging the rest of the world along with us.

The present administration, of course, is clueless.

We're all about to experience that Chinese curse as our times become all too interesting.

manufacturing base and an increase in jobs. However, the chances that we'll ever be able to compete on a head to head base with people in the third world depends entirely on how far it falls and how high transportation costs become. If third world currencies still trade at a great disadvantage against even a fallen dollar (a distinct possibility), we'll go from recession to depression very quickly as more and more jobs are pushed offshore by companies who are trying to stay afloat in the absence of a big market in which to peddle their goods and services.

New Deal Big Government is the only thing that could turn it around in such a case, and since borrowing their way out of the mess would no longer be an option, they'd have to go after the rich, which means as likely as the Pope on a pogo stick if the GOP is still in charge.

They found in the 30s that depression is a vicious circle, with unemployed people being unable to afford goods and services, which means the people still producing them get thrown out of work, creating more unemployed people, creating even less demand. The protections they instituted kept recessions mild until now. The destruction of these protections will lead to a disaster, and I'm afraid it's coming sooner rather than later.

He said that FDR proved that depressions didn't matter.

the treasonous "librul" bastards, naturally.
BHN

Don't they desire a weak dollar and high debt so they can increase the demand for US exports all the while cutting social spending?

I've heard that Bush and the fundies do not care about deficits and government debt, and are making both grow on purpose. They know our creditors overseas will sooner or later force us to cut back spending. At that point the administration will no doubt let loose with some terror scares, and say that all budget cuts must be domestic. At that point, US government spending will be almost entirely defense and SS, and the populace will have to rely on churches for all of their needs.

In four years or so they will be gone... having made all their money, which I'm sure will be converted into other currency's.
They will live happily ever after while we pay and pay and pay and pay for these 8 years. ugh.

And you are SO right.
BHN

Business, homes, they will get even richer. It happened before, remember.

That or get the corporations to move jobs and products back in-house. This will reduce the trade deficit.

The CEOs would not lose any income worth having by doing this and America would return to its glory days.

The fact the last 4 presidents have done nothing about the trade deficit issue (and fuck the repukes for bashing Clinton when Reagan, Bush 1, and Bush 2 have done just as little) only shows the rich are raping us to the bone.

So when will we be left to die, broken in the middle of desert highway?

...GOP to destroy Social Security and Medicare, and we have a real financial tsunami about to wipe out the middle class ans completely destroy the poor.

Welcome to Herr Busch's Reich.

Don't forget . . . they've started on Medicade now as well.

refuses to repay our debt? They could just say we need all our money here for security reasons so we aren't going to pay anyone back. I think there are some countries asking themselves this very thing and coming to the conclusion it ain't worth it. Euros are more valuable anyway....

We sustain our reckless greed by getting poorer nations to buy up our debt, knowing that if we fail, it messes everything up for everyone. It's all well and good to bully and enslave the rest of the world, but at some point, the dam may simply burst. At least if we implode it'll be well deserved. Of course, the rich will skate, merely losing a few heaps of loot in the process, but the workers and the poor will bear the traditional brunt.

Stupid. Evil. Lame.