Will the value of the $ bounce back?

[Winner]

Weaker dollar = greater demand for products produced within the USA, both by US consumers as well as foreign consumers.

Too bad the US is the largest importer.

 

[Winner]

I wonder if the collapse scenario after oil begins to be traded for euros (or other currency) happens.

 

[Ramius75]

I wonder if the collapse scenario after oil begins to be traded for euros (or other currency) happens.

Saddam tried to do that... but he was invaded and hung...

 

[Winner]

Saddam tried to do that... but he was invaded and hung...

That's a conspiracy theory, I mean it seriously.

Huge amounts of US currency circulate outside the US economy, serving as a "world currency". But what if some other currency took its place? Dollar reserves would become worthless piles of paper, everybody would start to sell it. It would rapidly depreciate (I mean really rapidly), inflation in the US would skyrocket and the world would face a major economic crises.

US is the largest importer and the EU and China sell most of their products there.

 

[Narz]

Vote for against. I'm gonna buy some gold and silver in a couple months.

 

[JerichoHill]

And youre going to lose money when you buy commodities Narz. Precious metals are always hawked by charlatans on late night TV preying on fear or misinformation.

If you're really that concerned, purchase an etf or market index of European firms. At least there you'll make money

 

[RedRalph]

From Ria Novosti:

MOSCOW. (RIA Novosti economic commentator Vlad Grinkevich) - The China-Russia Friendship Year is finishing early this month with great pageantry. Economic contacts underlying the galas are asymmetrical-Russia has silently accepted the role of China's sales outlet and raw material supplier.

The two countries' political and business leaders are gathering in Moscow, November 6, for a second bilateral economic forum to take stock of mutual interests. Chinese interests are clear as it is, while Russian are based on China's advance to the world economic stage.

Indicatively, Jim Rogers, board chairman of Beeland Interests Inc. investment company, is shifting all his assets from the dollar to the yuan, which he expects to treble or even quadruple in the next decade. The American financial pundit said in late October he was pessimistic about his country's economy. Warren Buffett, the world's greatest stock market investor, and second on the billionaire list, mentioned non-dollar investment as his vital strategy several years ago. Equally tellingly, there are five Chinese blue chips and only three American on the world's capitalization top ten list.

China is, in certain respects, no exception in the developing world, whose markets are growing at an annual 50% rate or even faster from their low starting point-a pace that naturally implies hazards.

The promise of quick money is not the only thing that attracts big business to China. There is a general eastward shift of global finance due to world economic and demographic trends.

Chinese economic growth has kept at an average 10% last years. China firmly leads the world as manufacturer of low price and low-tech consumer goods, and ranked second in high-tech exports last year. It is following the road of Japan, Singapore, Thailand, Taiwan and Hong Kong, who owed their economic booms to export orientation. With cheap workforce, and free of intellectual property legal restrictions, they were avidly borrowing Western R&D to offer competitive commodities at much lower prices. Western companies soon shifted their own production to Asia.

China differs from its economic forerunners-its population of 1.3 billion makes up 20% of the world total. Low wages satisfy its huge and conscientious workforce. Low yuan rates promote Chinese exports worldwide. Immune to market ups and downs, the yuan has earned its country the reputation of an investment haven.

It is difficult for the Western world to compete. The present-day U.S. economic growth rate is 3.9%, and the European Union's is 2.9%-this against burdensome pension and public welfare expenses as the population is aging rapidly. Social expenditures will peak in 2010-2015, with an expected drop of economic progress and living standards.

Production has shifted its core to Asia. The United States owes its leadership to sophisticated finance in need of steady inflow, with snowballing debts. Its trade gap made $836 billion last year, and the national debt leapt over $8 trillion.

China has a contrasting problem, with a need to slow down its economic growth from the current 10%. Meanwhile, some experts forecast its high pressure economy to treble within the next 20 years, and lead the world in trade and the gross domestic product, if calculated according to PPP (purchasing power parity).

Asia Pacific leads the world economy even now. It accounted for half of foreign trade and 60% of the world aggregate GDP at the turn of the century. The APEC meeting of 2001 called the region to replace the dollar with a new unit, the ACU, hinting at the United States' decline as regional leader.

With all these initiatives, Asia is passing over in conspicuous silence the emergence of China as its its new leader. Certain experts point to its long-established grip on the Asian-Pacific economy. America leads the show through financial institutions. Unlike it, China uses its Diaspora as a tool. Ethnic Chinese control 50% of private capital in the Philippines, 70% in Indonesia, and 80% in Thailand and Malaysia. The Diaspora is China's main overseas investor and export promoter. Now, China needs only to formalize its power. The yuan is forecast to become an all-Asian currency unit within twenty years in just such a formal move, and so bury the ACU idea.

 

[Godwynn]

Vote for against. I'm gonna buy some gold and silver in a couple months.

Bad news.

It took Gold 26 years to reach it's highest value back in 1980. (IIRC)

Imagine a 0% return for 26 years. During that same time period the Dow Jones has increased in value almost 15 fold.

 

[bathsheba666]

Sure it will. It always has before.

.....Link?

 

[JerichoHill]

.....Link?

There doesnt need to be a link. Currency values fluctuate. The dollar has risen and fallen in strength at various points through the last century.

The US is not immune to business cycles or currency cycles.

 

[sirdanilot]

I really, really hope that the US Dollar won't increase in value, as now, things from the USA and trips to the USA are actually affordable!

 

[JerichoHill]

I really, really hope that the US Dollar won't increase in value, as now, things from the USA and trips to the USA are actually affordable!

It will, over time.

You'll have several years to enjoy the cheap goods though. Just a warning. Once you really start to enjoy the cheap goods and cheap travel, you'll be helping the dollar increase in value

 

[Mirc]

No, continued slow decline.

 

[Winner]

There doesnt need to be a link. Currency values fluctuate. The dollar has risen and fallen in strength at various points through the last century.

The US is not immune to business cycles or currency cycles.

The right question is: has it ever plunged so deep so quickly in the last, say, 50 years?

 

[MobBoss]

Vote for against. I'm gonna buy some gold and silver in a couple months.

Rofl...your too late.....gold has already gone through the roof.

.....Link?

There doesnt need to be a link. Currency values fluctuate. The dollar has risen and fallen in strength at various points through the last century.

The US is not immune to business cycles or currency cycles.

What he said

 

[Masquerouge]

I don't see why this cycle should be different from any other cycles.

 

[Mise]

I reckon it'll fall back within the next year or so and stay around the $2 per pound mark for a few years more.

This prediction brought to you by Crystal Ball Readings.

 

[mrt144]

It will, over time.

You'll have several years to enjoy the cheap goods though. Just a warning. Once you really start to enjoy the cheap goods and cheap travel, you'll be helping the dollar increase in value

god bless our semi efficient markets!

 

[JerichoHill]

The right question is: has it ever plunged so deep so quickly in the last, say, 50 years?

Yes, many times.

Again, this is a MEDIA created crisis. 78-80 was a particularly bad time and we got through that. Last I checked interest rates are not 17%, inflation is not something comparable, and were not lining up for hours to purchase gas

Cycles happen folks. Ignore the idiots in the media

 

[Shadylookin]

I agree spending on the wars in Iraq and Afghanistan has been unfathomably costly. Hopefully our involvement there will end sooner rather than later.

But, the economy of the USA is doing well, thanks in part to our weak dollar

Weaker dollar = greater demand for products produced within the USA, both by US consumers as well as foreign consumers.

The US is a big importer. with a weaker dollar means our imports(damn near everything) is going to be higher. Plus it means our goods are more attractive to foreigners so demand increases which means prices will go up. So it's safe to say that consumers will be forking over more cash to buy things.