Sunday, January 18, 2015
Actually, its a tug of war between a rising Dollar, falling Euro & collapsing currency pegs
"The next crisis will be the currency pegs against the dollar. Here we have pegs from Hong Kong to the Middle East. We will have the same problem for as the dollar is driven higher, thanks to the implosion in the Euroland, these nations will import DEFLATION from a rising dollar. This will break their backs and force pegs to collapse around the world." Armstrong points towards the dollar reaching a strength that breaks its pegs around August 2015. He says this would lead to an awful depression. I doubt it. I think that free market economics come alive with floating pegs, providing multiple buffers to spontaneously regulate capital flows and absorb imbalances. However, adjustment could be painful.