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Why The Dollar's Reign Is Near An End

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http://online.wsj.com/article/SB10001424052748703313304576132170181013248.html?mod=WSJ_hp_us_mostpop_read

The single most astonishing fact about foreign exchange is not the high volume of transactions, as incredible as that growth has been. Nor is it the volatility of currency rates, as wild as the markets are these days.

Instead, it's the extent to which the market remains dollar-centric

Consider this: When a South Korean wine wholesaler wants to import Chilean cabernet, the Korean importer buys U.S. dollars, not pesos, with which to pay the Chilean exporter. Indeed, the dollar is virtually the exclusive vehicle for foreign-exchange transactions between Chile and Korea, despite the fact that less than 20% of the merchandise trade of both countries is with the U.S.

Chile and Korea are hardly an anomaly: Fully 85% of foreign-exchange transactions world-wide are trades of other currencies for dollars. What's more, what is true of foreign-exchange transactions is true of other international business. The Organization of Petroleum Exporting Countries sets the price of oil in dollars. The dollar is the currency of denomination of half of all international debt securities. More than 60% of the foreign reserves of central banks and governments are in dollars.

The greenback, in other words, is not just America's currency. It's the world's.

But as astonishing as that is, what may be even more astonishing is this: The dollar's reign is coming to an end.

more at the link...

Lots of dollar bashing articles in major publications in the last week. Would a nice extension to the libyan conflict with the yanks wading in be good for the dollar, by any chance?

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http://online.wsj.co...us_mostpop_read

Lots of dollar bashing articles in major publications in the last week. Would a nice extension to the libyan conflict with the yanks wading in be good for the dollar, by any chance?

Media are a contra indicator. The more anti-dollar articles, the more likely we're near a low.

If Jim Rogers says to sell everything dollar related then you know it's a low. :D

Edited by Red Karma

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Media are a contra indicator. The more anti-dollar articles, the more likely we're near a low.

If Jim Rogers says to sell everything dollar related then you know it's a low. :D

Well yes, exactly.

I was wondering the reason the PTB are getting hacksville to push the market to the dollar exit. Obviously it's about to bounce (or so those in the know firmly believe.)

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At least with the US out of the picture they will stop all that annoying buying of things other countries make. I am sure our good friends the democratic and free Chinese will be pleased to see the US buying less of their stuff. And an additional benefit for us, as their biggest trading partner, is that we wont have to export so much stuff to the US.

Yippee--the end of the Us Dollar! :lol:

Hang on.............................. :o

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Media are a contra indicator. The more anti-dollar articles, the more likely we're near a low.

If Jim Rogers says to sell everything dollar related then you know it's a low. :D

The thing that has me puzzled is that at a time like this one would have expected a dollar surge already as cash ran for safety. The dollar has remained broadly flat if not fallen since this recent turn of events - looks a little like a loss of faith, especially since metal has done what would be expected.

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The thing that has me puzzled is that at a time like this one would have expected a dollar surge already as cash ran for safety. The dollar has remained broadly flat if not fallen since this recent turn of events - looks a little like a loss of faith, especially since metal has done what would be expected.

Low dollar is US policy at the moment as an aid to export led recovery. So far its working somewhat with better employment numbers.

US need high Euro especially--this is what gets Sarkozy's goat.

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This "it's the end of the dollar because it's quite low" happens all the time, it's just that the cycle of highs and lows is shortening due to currencies oscillating all over the place with central bank interventions/ money printing/ ZIRP.

Still, there is always the chance that this is 'the one', the dollar doesn't bounce back off the low trading band and we start seeing a rapid collapse (instead of slow decline which is definitely happening) and dollars flooding back into the US, causing hyperinflation there.

Personally I think it's more likely that the dollar will rebound and recover somewhat.

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The thing that has me puzzled is that at a time like this one would have expected a dollar surge already as cash ran for safety. The dollar has remained broadly flat if not fallen since this recent turn of events - looks a little like a loss of faith, especially since metal has done what would be expected.

oil up = dollar down.

so the oil scare is presumably balancing any safe haven bolloks.

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The thing that has me puzzled is that at a time like this one would have expected a dollar surge already as cash ran for safety. The dollar has remained broadly flat if not fallen since this recent turn of events - looks a little like a loss of faith, especially since metal has done what would be expected.

History rhymes but never repeats.

Its worth noting that the rush to the dollar happened when Ben didn't have any paper in his presses - he has plenty of paper and ink now ;).

Liquidity is now infinite.:)

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oil up = dollar down.

so the oil scare is presumably balancing any safe haven bolloks.

Food prices in the Middle East have doubled in the last year thats the cause of the strife (thankyou Ben!) especially as they spend some 70% of their takehome on food and energy.

The solution will be ......... more printing.

Rinse and repeat.

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the simple reason why the dollar is the worldwide currency is because the US dominated the world economy.

you use to feel safe in the knowledge that you can spend your money in the US or buy goods from the US.

but the world is far more diverse and integrated now, the Euro is just as tradeable, with 500million users and a 1 2trillion euro economy, it is the biggest economy in the world so no one is going to refuse Euros as a matter of liquidity.

same goes for the yuan in the future. at the moment, if you have yuan you cant freely spend it so it wont be popular until the country opens up properly.

in any case these days you can trade currency from your own PC, so theres no longer a need for a worldwide currency like the dollar.

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This "it's the end of the dollar because it's quite low" happens all the time, it's just that the cycle of highs and lows is shortening due to currencies oscillating all over the place with central bank interventions/ money printing/ ZIRP.

Still, there is always the chance that this is 'the one', the dollar doesn't bounce back off the low trading band and we start seeing a rapid collapse (instead of slow decline which is definitely happening) and dollars flooding back into the US, causing hyperinflation there.

Personally I think it's more likely that the dollar will rebound and recover somewhat.

Bankrupt states and municipalities in the US make Ireland, Greece and Portugals problems look like an orderly vicars tea party.

However that doesn't mean the demise of the USD just yet as you say but its coming.

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ultimately it is the US economy that gives the fundamental value to the US dollar. as the demise of the dominance of the american economy grows, the demise of the dollar will follow suit.

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At least with the US out of the picture they will stop all that annoying buying of things other countries make. I am sure our good friends the democratic and free Chinese will be pleased to see the US buying less of their stuff. And an additional benefit for us, as their biggest trading partner, is that we wont have to export so much stuff to the US.

Yippee--the end of the Us Dollar! :lol:

Hang on.............................. :o

Yep, it will be all out economic collapse, not to mention the fact that all currencies being backed by the dollar will also collapse. Gold/silver will be shining bright when it happens.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
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