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Why the dollar is going to collapse

angloaustria.blogspot.com

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Re: Why the dollar is going to collapse

#41

Post by [deleted] »

nostrademons wrote: post #39
stuffthatmatter wrote: post #35

Earlier quoted context omitted.

there's one incorrect logic in your statement: You assume US can just slam on the brakes and the brakes would stop the car completely. When in fact, with the massive amount of baby boomers retiring/draining SS and medicare, the disappearance of our manufacturing sectors, the increasing commodity (food, oil) prices, and the need to pay back 100T+ debt owed to foreign countries and to ourselves, I suggest that it is im…

"massive amount of baby boomers retiring/draining SS and medicare" This is deflationary, at least in asset markets. Retiring baby boomers = pulling their money out of the stock market = falling stock prices. "the disappearance of our manufacturing sectors" Deflationary in consumer markets, inflation in asset markets, at least to the extent that it results in job losses and concentration of wealth among a professional…

[deleted]

Re: Why the dollar is going to collapse

#42

Post by ubernostrum »

jwb119 wrote: post #21

i think the point here is that for the first time in quite a while the dollar has a legitimate _chance_ at hitting a doomsday scenario. whether or not that happens remains to be seen, but the odds are greater than they have been historically. keep in mind that during the depression we were on the gold standard, thus there was none of the inflationary/deflationary risk of a fiat currency..

"keep in mind that during the depression we were on the gold standard, thus there was none of the inflationary/deflationary risk of a fiat currency"

Sure there was. Gold as currency is just as susceptible to instability as anything else, as a simple thought experiment can show.

Consider that the supply of gold, though growing, grows extremely slowly. The supply of goods and services which are exchanged in economic transactions (and for which currency acts as a proxy), however, goes through great spurts of growth which the supply of gold cannot hope to match. Thus, a gold standard during such a spurt can only lead to widespread deflation (as would any currency which failed to keep pace with the quantity of goods and services it must stand in for).

I really don't know why people harbor this mystical belief that a shiny piece of metal is somehow immune to well-understood economic principles.

Re: Why the dollar is going to collapse

#43

Post by stuffthatmatter »

biohacker42 wrote: post #14

I am sure we'll see increased inflation, will it go as high as it did in the 70s-80s maybe. But this article is claiming the sky is falling. Oooh look scary charts, never mind what velocity of money is or how it works, or that the Fed can increase AND decrease the money supply, just look at those scary charts!

You believe the same Fed that gave bankers billions of dollars and is actively working against congress to be audited, is going to 'decrease the money supply', ignore our huge debt and save us all?

You are drinking alot of government kool-aid. Keep watching CNBC.

Re: Why the dollar is going to collapse

#44

Post by fatdog789 »

barrkel wrote: post #38
jacquesm wrote: post #3

I looked through your submissions and the other pages on that blog for a bit, interesting collection. Stuff that matters indeed. In the interest of full disclosure, do you still hold dollars or have you completely converted to gold now ?

Of course, in the case of a true doomsday situation, gold will also inflate - people will be desperate, and increasing amounts of gold required to get anywhere. Without a functioning economy, everything is scarce => expensive.

I have a gun. You have gold. Which do you think is more valuable?

Force trumps money, currency, and metal. In a true doomsday situation, the guy with the gun will always have more in the bank than the guy with the gold.

Re: Why the dollar is going to collapse

#45

Post by BrentRitterbeck »

fatdog789 wrote: post #44
barrkel wrote: post #38

Earlier quoted context omitted.

Of course, in the case of a true doomsday situation, gold will also inflate - people will be desperate, and increasing amounts of gold required to get anywhere. Without a functioning economy, everything is scarce => expensive.

I have a gun. You have gold. Which do you think is more valuable? Force trumps money, currency, and metal. In a true doomsday situation, the guy with the gun will always have more in the bank than the guy with the gold.

Yeah, but gold can buy you not only guns, but people with guns.

Re: Why the dollar is going to collapse

#46

Post by anigbrowl »

stuffthatmatter wrote: post #35
anigbrowl wrote: post #29

You seem obsessed with this topic, but I question the quality of your sources and analysis. Of course if there were an exponential rise in money supply or similar absent a different fiscal, monetary and regulatory climate then this would be deeply alarming. But I feel you're making a meta-version of the same mistake many economists did, of over-extrapolating from a short trend. Massive policy changes inevitably resul…

there's one incorrect logic in your statement: You assume US can just slam on the brakes and the brakes would stop the car completely. When in fact, with the massive amount of baby boomers retiring/draining SS and medicare, the disappearance of our manufacturing sectors, the increasing commodity (food, oil) prices, and the need to pay back 100T+ debt owed to foreign countries and to ourselves, I suggest that it is im…

Oh, come now. What you say is correct and this is a big problem for the US, even more so for Europe, but that's a fiscal matter, not a monetary one. Indeed, if your hyperinflation scenario were to come true, one of the silver linings would be that we'd inflate away much of our external debt.

But really, we both know the Fed is tinkering with monetary policy in response to the recent financial crisis, not in response to the upcoming demographic one. Unless you want to go all tinfoil hat and say they provoked the former in order to deal with the latter by stealth :)

I feel you're shifting the goalposts a little with this post, although it is an interesting issue in its own right.

Re: Why the dollar is going to collapse

#47

Post by stuffthatmatter »

nostrademons wrote: post #39
stuffthatmatter wrote: post #35

Earlier quoted context omitted.

there's one incorrect logic in your statement: You assume US can just slam on the brakes and the brakes would stop the car completely. When in fact, with the massive amount of baby boomers retiring/draining SS and medicare, the disappearance of our manufacturing sectors, the increasing commodity (food, oil) prices, and the need to pay back 100T+ debt owed to foreign countries and to ourselves, I suggest that it is im…

"massive amount of baby boomers retiring/draining SS and medicare" This is deflationary, at least in asset markets. Retiring baby boomers = pulling their money out of the stock market = falling stock prices. "the disappearance of our manufacturing sectors" Deflationary in consumer markets, inflation in asset markets, at least to the extent that it results in job losses and concentration of wealth among a professional…

I was talking more about the economy with my list.

As far as deflation is concerned, there's deflation in things we want (houses, cars, luxury items), and inflation in things we need (food, oil, gas, utilities).

Until hyperinflation hits, of course.

Re: Why the dollar is going to collapse

#48

Post by anigbrowl »

stuffthatmatter wrote: post #40
barrkel wrote: post #37

Earlier quoted context omitted.

The US govt has ~11T in debt, not 100+T. I think you're mistaking gross debt positions with net position?

I said "100T+ debt owed to foreign countries and to ourselves" For a brief summary, check this link http://www.usdebtclock.org/ The link doesn't include US company debts (10T), or derivatives owed to other countries (200T)

That's a pretty link, but one that suffers badly from a lack of sourcing or context. The 'about' page says 'all debt clocks are updated constantly to the most precise calculations using complex formulas and exacting standards, and are verified from multiple sources.'

A pity that these exacting standards do not apply to the grammar on that page, which is a poor indicator for the quality of the (secret) formulas. As for the multiple sources, this may be true, but I am skeptical of a website with no names attached and registered in secret through domainsbyproxy.com, a GoDaddy spinoff which seems to provide registration services for a disproportionate number of GOP-friendly websites.

Not, mind you, that alarmist number vomit is the sole preserve of the GOP. One could find plenty of Democrats willing to scream with equal horror about the idea of $644 trillion in outstanding derivatives, without pausing to consider the global scope, long temporal horizon, or purely notional value of such a figure.

I'm sorry to be a pompous prick in response to what is probably a sincere desire to highlight issues you believe to be important. But I think to discuss them most effectively, you need to hone your arguments and your sources. I know it's hard to strike a balance between the dramatic statistic which highlights the urgency of an issue and the demands of accuracy, which can obscure that urgency with a mass of contextual and qualifying data.

Re: Why the dollar is going to collapse

#49

Post by reedlaw »

northwind wrote: post #34

As an interesting (as in "odd") exercise, go to the root node of the blog ( http://angloaustria.blogspot.com/ ) and notice the phrase "Curse of Maturin Towers". After asking yourself "WTF does that mean?", do a Google search for the aforementioned phrase ( http://www.google.com/#hl=en&q=Curse+of+Maturin+Towers ); hmm, no useful results (that is, we could not find a definition). Now do a Google search for "Maturin Tow…

That sounds more like a Goolgewack (http://en.wikipedia.org/wiki/Googlewhack) than good SEO. How would a blog benefit from using a keyword no one searches for?
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