Read This Because the Dollar Is Doomed

Damocles

Damocles

Accedo!
Staff member
Read This Because the Dollar Is Doomed


By Tim Hanson
August 28, 2009

Brian Richards and I wrote back in March that we thought the dollar might be doomed. That was because:

1. The United States has a massive and growing deficit.
2. The United States continues to generate significant trade deficits.
3. The United States has become oh-so-willing to print money out of thin air to meet its increasing obligations, and to prop up the likes of AIG (NYSE: AIG) and Bank of America (NYSE: BAC).

The more things change …
Fast forward five months, and that willingness to print and spend has only increased. None other than Warren Buffett of the famously successful Berkshire Hathaway (NYSE: BRK-A) put the nail in the dollar's coffin in a New York Times editorial last week.

He wrote, "Fiscally, we are in uncharted territory" and concluded that "Unchecked greenback emissions will certainly cause the purchasing power of currency to melt. The dollar's destiny lies with Congress."

Lies with Congress? If you know anything about Congress -- I used to work in the political game -- then you know for sure now that the dollar is doomed.

Deep breaths
This should be worrisome news if you earn a dollar-based salary, keep a dollar-based bank account, or invest in dollar-denominated U.S. stocks and bonds. Why? Because as the dollar declines in value, so too will all of your earnings, savings, and investments. And that's scary stuff.

The good news for you is that the dollar's decline in value over time won't happen in a vacuum. In order for the dollar to decline, other world currencies must rise in value against it. That means you can protect yourself -- and even profit -- from the dollar's decline simply by buying stocks that do business in other currencies, such as Coca-Cola (NYSE: KO) or Wal-Mart (NYSE: WMT), and specifically in currencies that you suspect will rise against the dollar over time.

More at link...

http://www.fool.com/investing/international/2009/08/28/read-this-because-the-dollar-is-doomed.aspx
 
Damocles said:
Read This Because the Dollar Is Doomed


By Tim Hanson
August 28, 2009

Brian Richards and I wrote back in March that we thought the dollar might be doomed. That was because:

1. The United States has a massive and growing deficit.
2. The United States continues to generate significant trade deficits.
3. The United States has become oh-so-willing to print money out of thin air to meet its increasing obligations, and to prop up the likes of AIG (NYSE: AIG) and Bank of America (NYSE: BAC).

The more things change …
Fast forward five months, and that willingness to print and spend has only increased. None other than Warren Buffett of the famously successful Berkshire Hathaway (NYSE: BRK-A) put the nail in the dollar's coffin in a New York Times editorial last week.

He wrote, "Fiscally, we are in uncharted territory" and concluded that "Unchecked greenback emissions will certainly cause the purchasing power of currency to melt. The dollar's destiny lies with Congress."

Lies with Congress? If you know anything about Congress -- I used to work in the political game -- then you know for sure now that the dollar is doomed.

Deep breaths
This should be worrisome news if you earn a dollar-based salary, keep a dollar-based bank account, or invest in dollar-denominated U.S. stocks and bonds. Why? Because as the dollar declines in value, so too will all of your earnings, savings, and investments. And that's scary stuff.

The good news for you is that the dollar's decline in value over time won't happen in a vacuum. In order for the dollar to decline, other world currencies must rise in value against it. That means you can protect yourself -- and even profit -- from the dollar's decline simply by buying stocks that do business in other currencies, such as Coca-Cola (NYSE: KO) or Wal-Mart (NYSE: WMT), and specifically in currencies that you suspect will rise against the dollar over time.

More at link...

http://www.fool.com/investing/international/2009/08/28/read-this-because-the-dollar-is-doomed.aspx
Click to expand...
I don't think I can take reading anymore. This is not good news.
 
don't think it is doom.....our country is very stable, in terms of having continual government, land people want to buy, products people want, culture etc....if america were militarily weak.....then yes.....our dollar would be shit

my hunch.....either in '12 or '16 a true conservative will come to office and trim the spending and debt..... and the dollar will gain
 
Damocles said:
Read This Because the Dollar Is Doomed


By Tim Hanson
August 28, 2009

Brian Richards and I wrote back in March that we thought the dollar might be doomed. That was because:

1. The United States has a massive and growing deficit.
2. The United States continues to generate significant trade deficits.
3. The United States has become oh-so-willing to print money out of thin air to meet its increasing obligations, and to prop up the likes of AIG (NYSE: AIG) and Bank of America (NYSE: BAC).

The more things change …
Fast forward five months, and that willingness to print and spend has only increased. None other than Warren Buffett of the famously successful Berkshire Hathaway (NYSE: BRK-A) put the nail in the dollar's coffin in a New York Times editorial last week.

He wrote, "Fiscally, we are in uncharted territory" and concluded that "Unchecked greenback emissions will certainly cause the purchasing power of currency to melt. The dollar's destiny lies with Congress."

Lies with Congress? If you know anything about Congress -- I used to work in the political game -- then you know for sure now that the dollar is doomed.

Deep breaths
This should be worrisome news if you earn a dollar-based salary, keep a dollar-based bank account, or invest in dollar-denominated U.S. stocks and bonds. Why? Because as the dollar declines in value, so too will all of your earnings, savings, and investments. And that's scary stuff.

The good news for you is that the dollar's decline in value over time won't happen in a vacuum. In order for the dollar to decline, other world currencies must rise in value against it. That means you can protect yourself -- and even profit -- from the dollar's decline simply by buying stocks that do business in other currencies, such as Coca-Cola (NYSE: KO) or Wal-Mart (NYSE: WMT), and specifically in currencies that you suspect will rise against the dollar over time.

More at link...

http://www.fool.com/investing/international/2009/08/28/read-this-because-the-dollar-is-doomed.aspx
Click to expand...
I will pass the article on to the Bud man, thanks
 
Yurt said:
don't think it is doom.....our country is very stable, in terms of having continual government, land people want to buy, products people want, culture etc....if america were militarily weak.....then yes.....our dollar would be shit

my hunch.....either in '12 or '16 a true conservative will come to office and trim the spending and debt..... and the dollar will gain
Click to expand...

LOL. The dollar is gaining.

Conservatives railed on over and over again about fear of inflation during Hoover's term. The central banks listened. Deflation reached over 10%.
 
TheHappyHippo said:
http://www.miseryindex.us/irbymonth.asp?StartYear=2008-07&EndYear=2009-07&submit1=Create+Report

Deflation is 2.1% in July, the highest it's been since the 40's post war deflation. It may possibly go above that. Which is seriously wrong - the economy in the 40's was deflating from massive war spending. We're deflating because conservatism ruined the economy for a decade, just like in the 30's.
Click to expand...
Deflation is just a precursor... You shouldn't rely on it lasting forever.
 
T&A said:
WTF Waterdork???




Deflation is good.
Click to expand...

800px-US_Historical_Inflation.svg.png



Gee, I wonder what happened during that 5 year period when deflation went so huge? Must've been an economic boom!
 
Damocles said:
Deflation is just a precursor...
Click to expand...

Can you point to a single time in American history where deflation has been "just a precursor" to inflation?

Look at 1921. 1930. Was that "just a precursor" to inflation? Conservatives should just admit they know shit about economics.
 
TheHappyHippo said:
Can you point to a single time in American history where deflation has been "just a precursor" to inflation?

Look at 1921. 1930. Was that "just a precursor" to inflation? Conservatives should just admit they know shit about economics.
Click to expand...
Inane. Your own chart shows that after the war that brought us out of the previous depression we went into a deflationary period followed by one of the largest inflationary periods ever. Before each inflationary period there is always a precipitous drop. While it is a lagging indicator, when inflation hits it will not be kind to us.

For gawds sakes, at least pay attention to the democrat Warren Buffet (Obama supporter extraordinaire)...

It's his prediction you are reading. Don't be foolish and think that deflation now indicates a good future, and we aren't in an artificial cycle like a WWII style war creates.

Each inflationary cycle is preceded by a precipitous drop, even in your own chart.
 
Damocles said:
Inane. Your own chart shows that after the war that brought us out of the previous depression we went into a deflationary period followed by one of the largest inflationary periods ever. Before each inflationary period there is always a precipitous drop. While it is a lagging indicator, when inflation hits it will not be kind to us.

For gawds sakes, at least pay attention to the democrat Warren Buffet (Obama supporter extraordinaire)...

It's his prediction you are reading. Don't be foolish and think that deflation now indicates a good future, and we aren't in an artificial cycle like a WWII style war creates.

Each inflationary cycle is preceded by a precipitous drop, even in your own chart.
Click to expand...

Are we even looking at the same chart damo?

There was post-war deflation in the late 40's, and then inflation in the early 50's caused by us entering the Korean war. Each and every period of inflation was preceded by inflation?

The late 70's? The greatest and most protracted inflationary period on the chart?

The late 70's? The greatest and most protracted inflationary period on the chart?

The great depression, in which there was huge deflation with no rebound period until WWII?

The early 1920's, when there was no signifigant inflation... until WWII?

Those are the only significant periods of deflation on the chart. The post 40's deflation followed by the Korean war is the only thing that really matches your hypothesis at all on the chart. The early 50's deflation is followed by a very moderate period of 4% inflation. And the inflation of WWII of course can't be blamed on the deflation preceding it.
 
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TheHappyHippo said:
Are we even looking at the same chart damo?

There was post-war deflation in the late 40's, and then inflation in the early 50's caused by us entering the Korean war. Each and every period of inflation was preceded by inflation?

The late 70's? The greatest and most protracted inflationary period on the chart?

The late 70's? The greatest and most protracted inflationary period on the chart?
Click to expand...
Each was preceded by a drop in inflation rates, you are being obtuse because you want to believe your inanity.
 
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