In an interview with CNBC, Ron Paul recently said the idea by Ben Bernanke that he will be able to manage inflation once it takes off is delusional.
Paul said, "When it gets to four [percent inflation], and decides to go to eight, there's no way they can stop it... They think they have control. They don't."
"They can't manage a dollar like this. People are going to desert the dollar. I think the Chinese are hinting that already. They're not wanting our dollars as much as they want raw materials and other things," added Paul.
The Chinese have quickly responded to the actions of Bernanke and the Federal Reserve, downgrading U.S. credit because of the latest round of quantitative easing, which will inject $600 billion into the economy over the next eight months, and if that doesn't work, hints from the Fed are they'll continue printing money until they get the economy moving, even though the $1.7 trillion already wasted has done nothing of the sort.
China said, "The serious defects in the U.S. economy will lead to long-term recession and fundamentally lower the national solvency. The credit crisis is far from over in the United States and the U.S. economy will be in a long-term recession. In essence, the U.S. government's move to devalue the dollar indicates its solvency is on the brink of collapse."
The Chinese rating agency Dagong Global Credit downgraded the sovereign debt rating of the U.S. from A+ to AA.
Other countries like Germany have made statements such as the US has been living on debt for far too long.
Showing posts with label US Dollar Collapse. Show all posts
Showing posts with label US Dollar Collapse. Show all posts
Tuesday, November 9, 2010
Monday, November 8, 2010
Gold Prices Soar Past $1,400 Today
Gold prices today moved above $1,400 an ounce, soaring past $1,402, a gain of $8.40 for spot gold.
Even though the U.S. dollar strengthened some today, that hasn't stopped the price of gold from rising, as it has performed that way contrary to the usual inverse relationship between the two, simply because the reasons for the support of rising gold prices overwhelm all other factors at times.
The implementation of another round of printing money will further weaken the U.S. dollar, but at the same time push investors toward investing in gold even more in order to protect against inflation and the loss in value of their capital.
The Federal Reserve's decision to throw another $600 billion into the economy in an attempt to boost the economy will backfire, as the former quantitative easing effort did.
But Ben Bernanke seemingly doesn't care, as there's little else he can do, and evidently doesn't believe in simply sitting still and allowing the market to cleanse and take care of itself.
Gold and gold mining companies, along with other commodities, will continue to rise as a result, and that is good for those investing in raw materials in the months ahead.
Even though the U.S. dollar strengthened some today, that hasn't stopped the price of gold from rising, as it has performed that way contrary to the usual inverse relationship between the two, simply because the reasons for the support of rising gold prices overwhelm all other factors at times.
The implementation of another round of printing money will further weaken the U.S. dollar, but at the same time push investors toward investing in gold even more in order to protect against inflation and the loss in value of their capital.
The Federal Reserve's decision to throw another $600 billion into the economy in an attempt to boost the economy will backfire, as the former quantitative easing effort did.
But Ben Bernanke seemingly doesn't care, as there's little else he can do, and evidently doesn't believe in simply sitting still and allowing the market to cleanse and take care of itself.
Gold and gold mining companies, along with other commodities, will continue to rise as a result, and that is good for those investing in raw materials in the months ahead.
Friday, November 5, 2010
US Dollar Will continue Collapse Even with Temporary Reprieve
The decision by the Federal Reserve Thursday has ended up producing upheaval in the Forex market Friday, as heads of central banks around the world reiterated their concerns over U.S. policy, with Asians unsurprisingly voicing their opposition the most.
The USD is plummeted around the globe, although rebounded Friday afternoon on the news jobs created in the U.S. were higher than anticipated.
With the promise by the Federal Reserve to inflate again through acquiring more government debt to the tune of $75 billion a month over the next eight months, the stock market took off, as many believed it would.
Gold prices have also soared, closing in on the $1,400 an ounce mark, which it will reach sometime within the week. Gold went against the grain again as the U.S. dollar rose, although the Euro only managed a slight gain because of a huge increase in CDS and cash spreads within Europe. The battle is beginning by nations against the move by the Fed, as they must defend their currencies against the fall in value of the U.S. dollar. That's great news for gold, as it remains the only real alternative as a currency, rising against many currencies around the world, one of the more overlooked, but important metrics to watch. Other commodities should continue to do well going forward as well with the misguided practices of the Federal Reserve continuing on.
Incredibly, the hapless Ben Bernanke, chairman of the Federal Reserve, continues to spew his unprovable assertion that the first round of quantitative easing or inflating saved the U.S. economy, when in fact things are as bad as they have ever been.
Saying the economy would have been worse is another way of admitting QE was an abysmal failure. You can't prove something that can't be measured, and you can't measure an economy that did nothing by saying it was the intervention of the Fed that protected it from getting worse, even as it didn't get better.
Bernanke knows this, but is playing games with those that don't understand how it all works, and who assume the printing of all that money had to have had some positive effect.
The truth is Bernanke admits, in spite of his other assertions, the first round of QE didn't work, which is why there is now a second round being enacted. His saying he wants inflation to be higher during this round of QE shows it failed the first time, generating the question as to how it's going to be different this time.
No matter what one may think in regard to this, the US dollar is in for a rough ride, and the Forex will be interesting to watch as countries implement measures to protect their currencies and exports.
The USD is plummeted around the globe, although rebounded Friday afternoon on the news jobs created in the U.S. were higher than anticipated.
With the promise by the Federal Reserve to inflate again through acquiring more government debt to the tune of $75 billion a month over the next eight months, the stock market took off, as many believed it would.
Gold prices have also soared, closing in on the $1,400 an ounce mark, which it will reach sometime within the week. Gold went against the grain again as the U.S. dollar rose, although the Euro only managed a slight gain because of a huge increase in CDS and cash spreads within Europe. The battle is beginning by nations against the move by the Fed, as they must defend their currencies against the fall in value of the U.S. dollar. That's great news for gold, as it remains the only real alternative as a currency, rising against many currencies around the world, one of the more overlooked, but important metrics to watch. Other commodities should continue to do well going forward as well with the misguided practices of the Federal Reserve continuing on.
Incredibly, the hapless Ben Bernanke, chairman of the Federal Reserve, continues to spew his unprovable assertion that the first round of quantitative easing or inflating saved the U.S. economy, when in fact things are as bad as they have ever been.
Saying the economy would have been worse is another way of admitting QE was an abysmal failure. You can't prove something that can't be measured, and you can't measure an economy that did nothing by saying it was the intervention of the Fed that protected it from getting worse, even as it didn't get better.
Bernanke knows this, but is playing games with those that don't understand how it all works, and who assume the printing of all that money had to have had some positive effect.
The truth is Bernanke admits, in spite of his other assertions, the first round of QE didn't work, which is why there is now a second round being enacted. His saying he wants inflation to be higher during this round of QE shows it failed the first time, generating the question as to how it's going to be different this time.
No matter what one may think in regard to this, the US dollar is in for a rough ride, and the Forex will be interesting to watch as countries implement measures to protect their currencies and exports.
Insteel Industries (Nasdaq:IIIN), Mechel OAO (NYSE:MTL), Universal Stainless (Nasdaq:USAP) Soar on Fed Inflation, Collapsing US Dollar
Insteel Industries Inc. (Nasdaq:IIIN), Mechel OAO (NYSE:MTL),
Universal Stainless & Alloy Pr (Nasdaq:USAP) all moved up with the broader commodity sector Thursday, as the reality the Federal Reserve was going to inflate again via its quantitative easing strategy pushed up the price of commodities in anticipation of the inevitable inflation to come.
Commodities moving up in price included gold, aluminum, silver and oil. Gold prices exploded record levels again, moving toward the $1,400 an ounce level. Silver pushed past the $26 mark, and is more than likely going to continue increasing for some time.
The steel industry overall may go through seasons of wide fluctuations as currencies sway in response to the drop in value of the U.S. dollar, which will affect margins because of the wide moves in currency value and the fight by some against the Chinese renminbi, which they'll be forced to take defensive measures against.
Taking into account market factors, and the general economic health of the steel industry , it more than likely won't partake in the surge in commodity prices and demand as other commodities will surely do.
Insteel Industries Inc. closed at $9.11 Thursday, rising $0.22, or 2.47 percent. Mechel OAO surged to close at $25.27, gaining $1.68, or 7.12 percent. Universal Stainless & Alloy Pr was up to $30.62 at the end of the trading session, gaining $1.03, or 3.48 percent.
Universal Stainless & Alloy Pr (Nasdaq:USAP) all moved up with the broader commodity sector Thursday, as the reality the Federal Reserve was going to inflate again via its quantitative easing strategy pushed up the price of commodities in anticipation of the inevitable inflation to come.
Commodities moving up in price included gold, aluminum, silver and oil. Gold prices exploded record levels again, moving toward the $1,400 an ounce level. Silver pushed past the $26 mark, and is more than likely going to continue increasing for some time.
The steel industry overall may go through seasons of wide fluctuations as currencies sway in response to the drop in value of the U.S. dollar, which will affect margins because of the wide moves in currency value and the fight by some against the Chinese renminbi, which they'll be forced to take defensive measures against.
Taking into account market factors, and the general economic health of the steel industry , it more than likely won't partake in the surge in commodity prices and demand as other commodities will surely do.
Insteel Industries Inc. closed at $9.11 Thursday, rising $0.22, or 2.47 percent. Mechel OAO surged to close at $25.27, gaining $1.68, or 7.12 percent. Universal Stainless & Alloy Pr was up to $30.62 at the end of the trading session, gaining $1.03, or 3.48 percent.
Gibraltar Industries (Nasdaq:ROCK), Harsco (NYSE:HSC), Haynes International (Nasdaq:HAYN) Surge on Collapsing US Dollar, Fed Inflation
Gibraltar Industries, Inc. (Nasdaq:ROCK), Harsco Corporation (NYSE:HSC) and Haynes International Inc. (Nasdaq:HAYN) all moved up with the broader commodity sector Thursday, as the reality the Federal Reserve was going to inflate again via its quantitative easing strategy pushed up the price of commodities in anticipation of the inevitable inflation to come.
Commodity prices surging included aluminum, gold, silver and oil. Gold prices soared record levels again, reaching toward the $1,400 an ounce level. Silver moved past the $26 mark, and is more than likely going to continue increasing for some time.
The steel industry may go through seasons of wide swings as currencies respond to the drop in value of the U.S. dollar, which will affect margins because of the wide moves in currency value and the fight by some against the Chinese renminbi, which they'll be forced to take defensive measures against.
Taking into account market factors, and the overall economic health of the steel industry in general, it probably won't partake in the surge in commodity prices and demand as other raw materials will surely do.
Gibraltar Industries, Inc. closed at $4.54 Thursday, rising $0.17, or 3.39 percent. Harsco Corporation (NYSE:HSC) surged to close at $24.03, gaining $1.59, or 7.09 percent. Haynes International Inc. was up to $15.73 at the end of the trading session, gaining $0.49, or 3.22 percent.
Commodity prices surging included aluminum, gold, silver and oil. Gold prices soared record levels again, reaching toward the $1,400 an ounce level. Silver moved past the $26 mark, and is more than likely going to continue increasing for some time.
The steel industry may go through seasons of wide swings as currencies respond to the drop in value of the U.S. dollar, which will affect margins because of the wide moves in currency value and the fight by some against the Chinese renminbi, which they'll be forced to take defensive measures against.
Taking into account market factors, and the overall economic health of the steel industry in general, it probably won't partake in the surge in commodity prices and demand as other raw materials will surely do.
Gibraltar Industries, Inc. closed at $4.54 Thursday, rising $0.17, or 3.39 percent. Harsco Corporation (NYSE:HSC) surged to close at $24.03, gaining $1.59, or 7.09 percent. Haynes International Inc. was up to $15.73 at the end of the trading session, gaining $0.49, or 3.22 percent.
Metalico (AMEX:MEA), Olympic Steel (Nasdaq:ZEUS), Steel Dynamics (Nasdaq:STLD) Boosted on Fed Inflation, Collapsing US Dollar
Metalico Inc. (AMEX:MEA), Olympic Steel Inc. (Nasdaq:ZEUS), Steel Dynamics Inc. (Nasdaq:STLD) all soared with the broader commodity sector Thursday, as the fact the Federal Reserve was going to inflate again via its quantitative easing strategy pushed up the price of commodities in anticipation of the inevitable inflation to come.
Commodity prices increasing included aluminum, gold, silver and oil. Gold prices soared record levels again, reaching toward the $1,400 an ounce level. Silver moved past the $26 level, and is probably going to continue moving up.
The steel industry could go through seasons of swings as currencies respond to the drop in value of the U.S. dollar, which will affect margins because of the wide swings in currency value and the battle by some against the Chinese renminbi, which they'll be forced to take defensive measures against.
Because of market factors, and the overall economic health of the steel industry in general, it probably won't partake in the surge in commodity prices and demand as other raw materials will surely do.
Metalico Inc. closed at $4.54 Thursday, rising $0.17, or 3.39 percent. Olympic Steel Inc surged to close at $24.03, gaining $1.59, or 7.09 percent. Steel Dynamics Inc. was up to $15.73 at the end of the trading session, gaining $0.49, or 3.22 percent.
Commodity prices increasing included aluminum, gold, silver and oil. Gold prices soared record levels again, reaching toward the $1,400 an ounce level. Silver moved past the $26 level, and is probably going to continue moving up.
The steel industry could go through seasons of swings as currencies respond to the drop in value of the U.S. dollar, which will affect margins because of the wide swings in currency value and the battle by some against the Chinese renminbi, which they'll be forced to take defensive measures against.
Because of market factors, and the overall economic health of the steel industry in general, it probably won't partake in the surge in commodity prices and demand as other raw materials will surely do.
Metalico Inc. closed at $4.54 Thursday, rising $0.17, or 3.39 percent. Olympic Steel Inc surged to close at $24.03, gaining $1.59, or 7.09 percent. Steel Dynamics Inc. was up to $15.73 at the end of the trading session, gaining $0.49, or 3.22 percent.
General Steel Holdings (NYSE:GSI), Gerdau S.A. (NYSE:GGB), Companhia Siderurgica Nacional (NYSE:SID) Rise on Fed Inflation, Collapsing US Dollar
General Steel Holdings (NYSE:GSI), Gerdau S.A. (NYSE:GGB) and Companhia Siderurgica Nacional (NYSE:SID) all moved up with the broader commodity sector Thursday, as the announcement that the Federal Reserve was going to inflate again via its quantitative easing strategy pushed up the price of commodities in anticipation of the inevitable inflation to come.
Commodity prices going up included aluminum, gold, silver and oil . Gold prices soared record levels again, reaching toward the $1,400 an ounce level. Silver exploded past the $26 level, and is ready to continue moving up.
The steel industry could go through a seasons of swings as currencies respond to the fall in value of the U.S. dollar, which will affect margins because of the wide swings in currency value and the battle by some against the Chinese renminbi, which they'll have to take defensive measures against.
Because of market factors, and the overall economic health of the steel industry, it probably won't partake in the surge in commodity prices and demand as other raw materials will surelydo.
General Steel Holdings closed at $39.40 Thursday, rising $0.86, or 2.23 percent. Gerdau S.A. surged to close at $13.55, gaining $0.29, or 2.19 percent. Companhia Siderurgica Nacional was up to $14.59 at the end of the trading session, gaining $0.54, or 3.84 percent.
Commodity prices going up included aluminum, gold, silver and oil . Gold prices soared record levels again, reaching toward the $1,400 an ounce level. Silver exploded past the $26 level, and is ready to continue moving up.
The steel industry could go through a seasons of swings as currencies respond to the fall in value of the U.S. dollar, which will affect margins because of the wide swings in currency value and the battle by some against the Chinese renminbi, which they'll have to take defensive measures against.
Because of market factors, and the overall economic health of the steel industry, it probably won't partake in the surge in commodity prices and demand as other raw materials will surelydo.
General Steel Holdings closed at $39.40 Thursday, rising $0.86, or 2.23 percent. Gerdau S.A. surged to close at $13.55, gaining $0.29, or 2.19 percent. Companhia Siderurgica Nacional was up to $14.59 at the end of the trading session, gaining $0.54, or 3.84 percent.
Nucor (NYSE:NUE), AK Steel (NYSE:AKS), Commercial Metals (NYSE:CMC) Rise on Collapsing US Dollar, Fed Inflation
Nucor (NYSE:NUE), AK Steel Holding (NYSE:AKS), Commercial Metals Company (NYSE:CMC) all moved up with the broader commodity sector Thursday, as the announcement that the Federal Reserve was going to inflate again via its quantitative easing strategy pushed up the price of commodities in anticipation of the inevitable inflation to come.
Commodity prices going up included gold, silver, oil prices and aluminum. Gold prices reached record levels again, straining toward the $1,400 an ounce level. Silver surged past the $26 level, and seems poised to continue moving up.
The steel industry could go through a period of fluctuation as currencies respond to the fall in value of the U.S. dollar, which will affect margins because of the wide swings in currency value and the battle by some against the Chinese renminbi, which they'll have to take defensive measures against.
Because of market factors, and the overall health of the steel industry, it probably won't participate in the surge in commodity prices and demand as other raw materials will do.
Nucor closed at $39.40 Thursday, rising $0.86, or 2.23 percent. AK Steel Holding surged to close at $13.55, gaining $0.29, or 2.19 percent. Commercial Metals Company was up to $14.59 at the end of the trading session, gaining $0.54, or 3.84 percent.
Commodity prices going up included gold, silver, oil prices and aluminum. Gold prices reached record levels again, straining toward the $1,400 an ounce level. Silver surged past the $26 level, and seems poised to continue moving up.
The steel industry could go through a period of fluctuation as currencies respond to the fall in value of the U.S. dollar, which will affect margins because of the wide swings in currency value and the battle by some against the Chinese renminbi, which they'll have to take defensive measures against.
Because of market factors, and the overall health of the steel industry, it probably won't participate in the surge in commodity prices and demand as other raw materials will do.
Nucor closed at $39.40 Thursday, rising $0.86, or 2.23 percent. AK Steel Holding surged to close at $13.55, gaining $0.29, or 2.19 percent. Commercial Metals Company was up to $14.59 at the end of the trading session, gaining $0.54, or 3.84 percent.
Thursday, October 21, 2010
JPMorgan (NYSE:JPM) Managing Russian Ruble Bond Sale
Along with Troika Dialog and OAO Gazprombank, JPMorgan (NYSE:JPM) is helping to manage the largest international markets ruble bond sale in the history of Russia.
The bond issuance could reach to as high as $3 billion, and is hitting the markets at the right time, as investors seek emerging markets investments with higher yields outside of the U.S. dollar, which continues to collapse.
According to Deputy Finance Minister Dmitry Pankin, the sale could come about as early as November 2010.
The problem with the issuance is the ruble itself, which while expected to increase in value, has no benchmark for ruble Eurobonds to be issued off of, so pricing them will be a challenge.
It remains to be seen if the hunger for alternatives for the U.S. dollar will help the issuance of the ruble bonds be successful. The ruble isn't considered that attractive either, but higher yields may overcome that.
The bond issuance could reach to as high as $3 billion, and is hitting the markets at the right time, as investors seek emerging markets investments with higher yields outside of the U.S. dollar, which continues to collapse.
According to Deputy Finance Minister Dmitry Pankin, the sale could come about as early as November 2010.
The problem with the issuance is the ruble itself, which while expected to increase in value, has no benchmark for ruble Eurobonds to be issued off of, so pricing them will be a challenge.
It remains to be seen if the hunger for alternatives for the U.S. dollar will help the issuance of the ruble bonds be successful. The ruble isn't considered that attractive either, but higher yields may overcome that.
Friday, October 8, 2010
Alcoa's (NYSE:AA) Performance Going Forward
While some celebrated the fact that Alcoa (NYSE:AA) analysts' profit estimates in the third quarter, they were still down 21 percent from previous results.
So even though aluminum prices helped their performance some, higher costs still cut into margins, generating lower results than they could have had. And that was with sales rising 15 percent to $5.3 billion.
Where does all this leave the company as it relates to the future?
They've already cut expenses to the bone, and while they may be able to whittle away a little more, there isn't much more it would to do affect the bottom line.
That means management has pretty much positioned themselves the best they can, other than possibly expanding through acquisition.
But that has its weaknesses as well, as the industry via its smelters can easily ramp up production and increase global aluminum inventory quickly, making acquisitions less desirable than other miners, such as in the gold mining industry.
One positive thing Alcoa and other commodity producing companies have going for them is the misguided policies of central banks around the world, who are committed to inflating (call it quantitative easing if it makes you feel better), which will drive down the value of the dollar, making it cheaper for overseas customers to buy aluminum in the case of Alcoa.
Lower prices alone can't be counted on though, as continued weaknesses in the global economy, especially in the West, could quickly skew the supply and demand picture, and little could be done if that ends up going down.
Since aluminum demand is for the most part coming from the emerging markets, that may not be as big of a factor, although it could still slow things down for a time, and stunt the rally they're experiencing now.
In other words, Alcoa is going to remain volatile and unpredictable, as there are too many factors happening at the same time to know which one will predominate and affect their markets.
One that can be counted on is weakening U.S. dollar and possible increased sales from overseas markets. If other things continue on as they are, that could be good news as long as the global economy and emerging markets remain fairly healthy.
That can't be measured by the West, as if they're not still in a recession, they're just on the other side of it, with the likelihood of dropping down into another one.
Alcoa's near and mid-term future is tied into emerging market growth. How they go will be how Alcoa goes, along with the secondary factors mentioned beyond supply and demand.
So even though aluminum prices helped their performance some, higher costs still cut into margins, generating lower results than they could have had. And that was with sales rising 15 percent to $5.3 billion.
Where does all this leave the company as it relates to the future?
They've already cut expenses to the bone, and while they may be able to whittle away a little more, there isn't much more it would to do affect the bottom line.
That means management has pretty much positioned themselves the best they can, other than possibly expanding through acquisition.
But that has its weaknesses as well, as the industry via its smelters can easily ramp up production and increase global aluminum inventory quickly, making acquisitions less desirable than other miners, such as in the gold mining industry.
One positive thing Alcoa and other commodity producing companies have going for them is the misguided policies of central banks around the world, who are committed to inflating (call it quantitative easing if it makes you feel better), which will drive down the value of the dollar, making it cheaper for overseas customers to buy aluminum in the case of Alcoa.
Lower prices alone can't be counted on though, as continued weaknesses in the global economy, especially in the West, could quickly skew the supply and demand picture, and little could be done if that ends up going down.
Since aluminum demand is for the most part coming from the emerging markets, that may not be as big of a factor, although it could still slow things down for a time, and stunt the rally they're experiencing now.
In other words, Alcoa is going to remain volatile and unpredictable, as there are too many factors happening at the same time to know which one will predominate and affect their markets.
One that can be counted on is weakening U.S. dollar and possible increased sales from overseas markets. If other things continue on as they are, that could be good news as long as the global economy and emerging markets remain fairly healthy.
That can't be measured by the West, as if they're not still in a recession, they're just on the other side of it, with the likelihood of dropping down into another one.
Alcoa's near and mid-term future is tied into emerging market growth. How they go will be how Alcoa goes, along with the secondary factors mentioned beyond supply and demand.
Friday, September 24, 2010
Gold Breaks $1,300 Today For First Time, Eases Back
For the first time in history gold hit the $1,300 mark, although it has pulled back some in mid-day trading.
Gold futures broke $1,300 in New York, as the U.S. dollar continues to disintegrate and investors move to protect their capital.
In London bullion traded at an all-time high as well.
The dollar will lose against the euro for the week as the Federal Reserve reiterated they're poised to stimulate the economy once again when needed, even after the wasted $1.7 trillion which miserably failed, although we'll have to still pay it all back.
Gold has broken records in four out of five trading sessions this week, and there's little to stand in the way of that continuing, although there will be corrections along the way.
Gold futures for December delivery rose to $1,300 an ounce on the Comex in New York.
Gold futures broke $1,300 in New York, as the U.S. dollar continues to disintegrate and investors move to protect their capital.
In London bullion traded at an all-time high as well.
The dollar will lose against the euro for the week as the Federal Reserve reiterated they're poised to stimulate the economy once again when needed, even after the wasted $1.7 trillion which miserably failed, although we'll have to still pay it all back.
Gold has broken records in four out of five trading sessions this week, and there's little to stand in the way of that continuing, although there will be corrections along the way.
Gold futures for December delivery rose to $1,300 an ounce on the Comex in New York.
Friday, July 16, 2010
US Dollar Crushed by Major Currencies
The US dollar got clobbered today as interest rates will be held down by the Federal Reserve for some time to come, as inflation remains low for the time being in the U.S.
Questions as to whether or not we've ever escaped the recession are increasingly being asked, as no jobs are being created in the private sector and housing remains in terrible condition, and is expected to worsen.
We still haven't seen the full effect of the commercial property market yet either, which is supposed to be in trouble over the second half of 2010.
The illusion the sovereign debt crisis in Europe has been handled because Greece has been able to auction bonds in the private markets is a real stretch, but that has strengthened the euro some for now, another downward pressure on the dollar.
Based on Wal-Mart (NYSE:WMT) starting a food price war to draw consumers back to the store, food prices dropped strongly in June, as they and competitors fought for foot traffic.
Consequently, the producer price index sank by 0.5 percent, after a 0.3 percent fall in May. Economists were said to be looking for 0.1 percent, but to me should have known better with the move by Wal-Mart and its competitors.
The dollar fell to 1.2910 against the euro, its worst showing in over two months.
Questions as to whether or not we've ever escaped the recession are increasingly being asked, as no jobs are being created in the private sector and housing remains in terrible condition, and is expected to worsen.
We still haven't seen the full effect of the commercial property market yet either, which is supposed to be in trouble over the second half of 2010.
The illusion the sovereign debt crisis in Europe has been handled because Greece has been able to auction bonds in the private markets is a real stretch, but that has strengthened the euro some for now, another downward pressure on the dollar.
Based on Wal-Mart (NYSE:WMT) starting a food price war to draw consumers back to the store, food prices dropped strongly in June, as they and competitors fought for foot traffic.
Consequently, the producer price index sank by 0.5 percent, after a 0.3 percent fall in May. Economists were said to be looking for 0.1 percent, but to me should have known better with the move by Wal-Mart and its competitors.
The dollar fell to 1.2910 against the euro, its worst showing in over two months.
Sunday, April 18, 2010
BRICs Continue Local Currency Pursuit
A growing number of nations are losing confidence in the U.S. dollar, as the endless printing of paper money has increased the pace of the drop in value of the dollar, and its desirability as a currency to do business in, as it's becoming questionable as to its long-term viability on a number of fronts; including whether countries want to continue to acquire the increasingly risky Treasuries, which have propped up the U.S. economy for a long time.
Although it's not the first time BRIC countries have let it be known they are looking for ways to conduct business in their own currencies, the fact that they're continuing to talk and pursue it shows it's not an issue that is going away, and also points to the probable removal of the U.S. dollar in the future as the currency to be traded in, to be replaced by the renminbi or yuan.
China already allows some business to be conducted on a regional basis in its own currency, and that is an experiment to see the potential of expanding to do business in foreign currencies besides the U.S. dollar.
The other thing on the positive side, is it seems to show not only a desire to do business beyond the U.S. dollar, but also that the countries are increasingly confident in the currencies of each country.
Although it's not the first time BRIC countries have let it be known they are looking for ways to conduct business in their own currencies, the fact that they're continuing to talk and pursue it shows it's not an issue that is going away, and also points to the probable removal of the U.S. dollar in the future as the currency to be traded in, to be replaced by the renminbi or yuan.
China already allows some business to be conducted on a regional basis in its own currency, and that is an experiment to see the potential of expanding to do business in foreign currencies besides the U.S. dollar.
The other thing on the positive side, is it seems to show not only a desire to do business beyond the U.S. dollar, but also that the countries are increasingly confident in the currencies of each country.
Sunday, March 21, 2010
Paul Krugman Clueless on China ... and Everything Else
Peter Schiff in talking about Paul Krugman - who doesn't have the right to be called an economist - asked for the Nobel Prize committee to take the medal back for stirring up issues with China that will end up doing the U.S. great harm.
Schiff calls out Krugman on calling for an economic war with China, where Krugman believes China no longer purchasing Treasuries is a winner for the U.S. and devastating to China.
But if China were to sell its existing debt or refuse to buy any more, the Fed would be forced to again ramp up the printing presses and throw more money at the problem, which even Krugman admits would cause the value of the U.S. dollar to fall; something he thinks would be good for all of us.
That would drive up prices for American consumers, although it would temporarily help American-made products to be more competitive on the world stage.
Consequently, the standard of living for most Americans would plunge, while the Chinese standard of living would continue to rise. That doesn't sound like a winning hand for America, and it isn't.
The Chinese would start to have their domestic prices lowered while their own factories would do the majority of the supplying of those goods.
Commodity prices in that scenario would also fall steeply, making it easier and cheaper for China to produce products to serve their people.
Being a fading Keynesian, all Krugman can think of is printing money will solve all economic problems. The idea of transferring that thought stupidly to the Chinese monetary situation is reckless and ignorant. No wonder Schiff is calling for the Nobel Prize committee to take the medal back from Krugman.
Of course he should never have received it in the first place.
Schiff calls out Krugman on calling for an economic war with China, where Krugman believes China no longer purchasing Treasuries is a winner for the U.S. and devastating to China.
But if China were to sell its existing debt or refuse to buy any more, the Fed would be forced to again ramp up the printing presses and throw more money at the problem, which even Krugman admits would cause the value of the U.S. dollar to fall; something he thinks would be good for all of us.
That would drive up prices for American consumers, although it would temporarily help American-made products to be more competitive on the world stage.
Consequently, the standard of living for most Americans would plunge, while the Chinese standard of living would continue to rise. That doesn't sound like a winning hand for America, and it isn't.
The Chinese would start to have their domestic prices lowered while their own factories would do the majority of the supplying of those goods.
Commodity prices in that scenario would also fall steeply, making it easier and cheaper for China to produce products to serve their people.
Being a fading Keynesian, all Krugman can think of is printing money will solve all economic problems. The idea of transferring that thought stupidly to the Chinese monetary situation is reckless and ignorant. No wonder Schiff is calling for the Nobel Prize committee to take the medal back from Krugman.
Of course he should never have received it in the first place.
Monday, March 15, 2010
Goldman Sachs (NYSE:GS): Buy Euro!
Goldman Sachs recommends to buy euro
Talking about whether to buy the euro or the U.S. dollar, Goldman Sachs (NYSE:GS) let be known what currency should be acquired, and that is the euro. They're probably right, as the underlying fundamentals of the U.S. dollar haven't changed, and only concerns over the Greek sovereign debt issue gave some temporary strength, based on the fall of the euro rather than something in herent in the dollar.
Most of this is based on short term emphasis and possible events, rather than long term investment suggestions.
Goldman believes the U.S. dollar will revert to its weakened condition, while in the short term the euro should have some nice upside surprises in store.
One of the more unprecedented turnarounds for the U.S dollar came when almost everyone was bullish on it until the Greek crisis and its effect on the euro, now that it has passed and Europe in general is supporting Greece, the dollar has nothing to make it keep its strength, while for now, the euro does.
Goldman acknowledges things could get stirred up in Europe again, but for now, the crisis have been avoided.
Goldman Sachs recommends to buy euro
Talking about whether to buy the euro or the U.S. dollar, Goldman Sachs (NYSE:GS) let be known what currency should be acquired, and that is the euro. They're probably right, as the underlying fundamentals of the U.S. dollar haven't changed, and only concerns over the Greek sovereign debt issue gave some temporary strength, based on the fall of the euro rather than something in herent in the dollar.
Most of this is based on short term emphasis and possible events, rather than long term investment suggestions.
Goldman believes the U.S. dollar will revert to its weakened condition, while in the short term the euro should have some nice upside surprises in store.
One of the more unprecedented turnarounds for the U.S dollar came when almost everyone was bullish on it until the Greek crisis and its effect on the euro, now that it has passed and Europe in general is supporting Greece, the dollar has nothing to make it keep its strength, while for now, the euro does.
Goldman acknowledges things could get stirred up in Europe again, but for now, the crisis have been avoided.
Goldman Sachs recommends to buy euro
Peter Schiff Warns U.S. Dollar Bulls
Peter Schiff on U.S. Dollar in 2010
Peter Schiff recently stated there is nothing more accurate than dissecting the fundamentals of a government to ascertain the value of its currency, and in the case of the U.S. dollar, that doesn't point to a reason those who are bullish on its strength should continue to be.
Very quickly the seemingly endless bearishness toward the U.S. dollar ended because of the sovereign debt crisis in Greece and the resultant plunge in value of the euro.
Now that it seems to be on relatively solid footing for now, the inherent value of the U.S. dollar should emerge again, and that should continue downward in Schiff's opinion, based on the continuing policies of the U.S. government which undermines its value.
In an extraordinarily short time Schiff notes, the sentiment concerning the fall of the U.S. dollar gravitated toward the euro, something he said, as far as how quickly it happened, he had never seen before in his life.
Schiff believes there will soon be a huge sell-of of the greenback, and once there is more of a surety concerning Europe, there is no reason people would hold onto the U.S. dollar, as it still remains a flawed currency.
Peter Schiff on U.S. Dollar in 2010
Peter Schiff recently stated there is nothing more accurate than dissecting the fundamentals of a government to ascertain the value of its currency, and in the case of the U.S. dollar, that doesn't point to a reason those who are bullish on its strength should continue to be.
Very quickly the seemingly endless bearishness toward the U.S. dollar ended because of the sovereign debt crisis in Greece and the resultant plunge in value of the euro.
Now that it seems to be on relatively solid footing for now, the inherent value of the U.S. dollar should emerge again, and that should continue downward in Schiff's opinion, based on the continuing policies of the U.S. government which undermines its value.
In an extraordinarily short time Schiff notes, the sentiment concerning the fall of the U.S. dollar gravitated toward the euro, something he said, as far as how quickly it happened, he had never seen before in his life.
Schiff believes there will soon be a huge sell-of of the greenback, and once there is more of a surety concerning Europe, there is no reason people would hold onto the U.S. dollar, as it still remains a flawed currency.
Peter Schiff on U.S. Dollar in 2010
Thursday, March 4, 2010
Marc Faber: Buy Gold Forever
Marc Faber on Dollar and Gold
In an interview on CNBC today, Marc Faber told interviewers that he recommends investors to buy gold on a monthly basis forever.
Part of Faber's reasoning is the ongoing printing of U.S. dollars which will continue to weaken the currency going forward.
Faber also recommends for investors to look toward emerging market stocks rather than shares in U.S. companies.
For the U.S. dollar, Faber says it won't necessarily go down like it may have under normal circumstances, because foreign government are also printing money, essentially competing with the dollar on the downward spiral in value of their currencies, making it harder to predict than in the past.
Marc Faber on Dollar and Gold
In an interview on CNBC today, Marc Faber told interviewers that he recommends investors to buy gold on a monthly basis forever.
Part of Faber's reasoning is the ongoing printing of U.S. dollars which will continue to weaken the currency going forward.
Faber also recommends for investors to look toward emerging market stocks rather than shares in U.S. companies.
For the U.S. dollar, Faber says it won't necessarily go down like it may have under normal circumstances, because foreign government are also printing money, essentially competing with the dollar on the downward spiral in value of their currencies, making it harder to predict than in the past.
Marc Faber on Dollar and Gold
Wednesday, March 3, 2010
Commodities Rise on Weaker Dollar
Commodity Prices Rise as Dollar Drops
A number of commodity sector rose as the U.S. dollar weakened against major currencies.
Enjoying the increase were energy, metals and grains, with major crops like corn, soybeans and wheat increasing; something the grain market has been looking and hoping for for awhile.
Also rising in response to the collapsing dollar were gold, silver and copper, while on the energy side price also rose, even though they would normally have fallen on the news oil and gasoline pireced remained higher than expected for the previous week.
Oil gained $1.19 to finish the session at $80.87 on the New York Mercantile Exchange.
Commodity Prices Rise as Dollar Drops
A number of commodity sector rose as the U.S. dollar weakened against major currencies.
Enjoying the increase were energy, metals and grains, with major crops like corn, soybeans and wheat increasing; something the grain market has been looking and hoping for for awhile.
Also rising in response to the collapsing dollar were gold, silver and copper, while on the energy side price also rose, even though they would normally have fallen on the news oil and gasoline pireced remained higher than expected for the previous week.
Oil gained $1.19 to finish the session at $80.87 on the New York Mercantile Exchange.
Commodity Prices Rise as Dollar Drops
Jim Rogers: Dollar Strength Temporary
Jim Rogers U.S. Dollar Strength
While Jim Rogers likes the U.S. dollar on a very temporary basis as far as holding its value, over the long term he is a dollar bear, and those affected by the greenback need to take that into consideration.
Rogers said not too long ago that the fact there were so many U.S. dollar bears made his contrarian tendencies believe the dollar would strengthen some, and it has since he made that statement.
Even so, there is little chance the dollar will hold its strength for long, and once it plunges it'll take those with it who thought it was in a bull rally.
Again, the key is this is only a very short term upwards move by the dollar, and it'll resume its downward spiral again. No one can be sure when, but it would be a mistake to look at the U.S. dollar as strong for any meaningful period of time.
Jim Rogers U.S. Dollar Strength
While Jim Rogers likes the U.S. dollar on a very temporary basis as far as holding its value, over the long term he is a dollar bear, and those affected by the greenback need to take that into consideration.
Rogers said not too long ago that the fact there were so many U.S. dollar bears made his contrarian tendencies believe the dollar would strengthen some, and it has since he made that statement.
Even so, there is little chance the dollar will hold its strength for long, and once it plunges it'll take those with it who thought it was in a bull rally.
Again, the key is this is only a very short term upwards move by the dollar, and it'll resume its downward spiral again. No one can be sure when, but it would be a mistake to look at the U.S. dollar as strong for any meaningful period of time.
Jim Rogers U.S. Dollar Strength
Friday, February 26, 2010
Commodities Rise on Falling Dollar
Commodity Prices Rising
The falling dollar gave commodities a boost today, as many raw materials rose as a result of the dollar-denominated factor.
Gold, silver, copper, platinum and palladium all enjoyed price increases with little resistance in a relatively light day of trading.
Another commodity sector rising was energy, where oil, natural gas and gasoline all spiked.
Also joining the other commodity sectors in rising in price were the grains, where corn, soybeans and wheat all moved upwards.
What this shows me is how important the U.S. dollar is to the inflationary pressure we continue to face. While that's nothing new, it does show how just a little weakness in the dollar can drive commodity prices upwards.
It also shows me how vulnerable we are to inflation, and how quickly things can change in relationship to that.
Commodity Prices Rising
Financial Advisor
The falling dollar gave commodities a boost today, as many raw materials rose as a result of the dollar-denominated factor.
Gold, silver, copper, platinum and palladium all enjoyed price increases with little resistance in a relatively light day of trading.
Another commodity sector rising was energy, where oil, natural gas and gasoline all spiked.
Also joining the other commodity sectors in rising in price were the grains, where corn, soybeans and wheat all moved upwards.
What this shows me is how important the U.S. dollar is to the inflationary pressure we continue to face. While that's nothing new, it does show how just a little weakness in the dollar can drive commodity prices upwards.
It also shows me how vulnerable we are to inflation, and how quickly things can change in relationship to that.
Commodity Prices Rising
Financial Advisor
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