Dollar melts

[GHOSTDANCER]

The dollar plunged to an all-time low against the euro yesterday as the Bush administration signalled it was not prepared to take any action to prevent the slide.

The greenback has resumed its fall since George Bush was re-elected and is down 40% against the euro over the past two years, reflecting growing concerns in currency markets over the giant US budget and current account deficits.

But US treasury secretary John Snow told the Royal Institute of International Affairs that his country's current account deficit was a problem for other nations as well and signalled his opposition to any kind of intervention to put a floor under the currency.
<http://www.guardian.co.uk/business/story/0,3604,1353645,00.html>

Can I get a thirdworld Yay Yay!!

[whirlygigspin]

1. now watch

as the currency slides into the toilet, interest rates will slowly creep up and your standard of living will fall......down....down...down...

Enjoy 4 more years!

[GHOSTDANCER]

3. Don't forget Corporate Crime the Price of oil for the clincher.. Buh Bye

[VivaKerry]

4. slowly creep up? Think again!

Greenspan will wake up and make up for all the interest rate increases he poo poo'd! What the hell...just turn this into a 3rd world country NOW... so they have two years before interim elections to spin it.

[Old and In the Way]

6. Pretty sad, isn't it?

And for all those that voted for this administration based on their BS rhetoric of values and "he's like us", good luck!

You've been had, bigtime.

[LiberalFighter]

66. But But But he is like them...

corrupt

[tavalon]

75. No, they are stupid or at the very least uninformed and easily led

He is corrupt. Well, his administration is, anyway.

[pa28]

23. It will.

And I'll take a dim view of all those Bush voters who complain about it. Hopefully nobody will ask me for sympathy.

[mother earth]

61. You got that right.

I really think the plan is to sink us into such a depression like never before, so that total control can rule from there. What will your attitude be when you have to worry about how you will feed your family? Total submission is what they are after, nothing less will suffice.

[nadinbrzezinski]

2. Any momnent now I will see Snowe

saying "I will defend the dollar like a dog"

Oh jokes about Chihuahuas comes to mind....

[Anarcho-Socialist]

5. Letting the Dollar slide will not help the U.S.

In historical terms a decreasing value of a nation's currency helps its manufacturing sector - but the U.S. manufacturing sector is being more and more outsourced and is significantly reduced from what it was.

[xray s]

11. The dollar would have to completely implode to attact manufacturing back

We would have to adopt the wages, labor practices and environmental protections of the third world to attract manufacturing jobs back.

Our sliding dollar will mean inflation, higher interest rates, exploding national debt and unemployment. Stagflation, as we used to call it in the 70's.

Monkeyboy's place in history will be a harsh place, indeed.

[DBoon]

20. I think that is the whole purpose of this

We would have to adopt the wages, labor practices and environmental protections of the third world to attract manufacturing jobs back.

Sounds like the real goal of Bush-o-nomics to me.

[Hog lover]

31. That's scary because probably very true - eom

[Skidmore]

42. I think you're correct, but will our fine scions of industry

start charging the valuable American consumer third world prices for products? I doubt it. Regardless of how lean and mean they get and how large their profits are, prices only go up. This is why we need a general consumer strike. We won't do that though because Americans don't like to do with out. They did a fine job creating a consumer base that firmly believes in instant gratification and thinks in terms of luxuries, not necessities. I don't know how you change people's priorities. Perhaps credit card interest rates at 30% again might be a good thing.

[girl gone mad]

21. Even that won't help..

as long as China keeps their currency pegged to ours, it will always be cheaper to manufacture in China.

[American Tragedy]

39. That would be a pyhrric victory if there ever was one

The good news is that the manufacturing sector is booming...the bad news is that groceries cost almost a billion dollars.

[Old and In the Way]

12. Yep....who's going to reinvest in brick and morter, equipment, and

training now? Look for this administration to help business by reducing federal minimum wage to make us more "competitive". The race to the bottom is on....

[GHOSTDANCER]

13. can you say "open open open!!"

<>

speaking of walmart Lastnights Frontline was awsome.
<http://www.pbs.org/wgbh/pages/frontline/shows/walmart/>

[nadinbrzezinski]

14. Just as long as Chna keeps playign the game

two worst case scenarios.

1.- China decides to peg to the Euro...

2.- China lets the dollar hit the basement and continue to free fall as they unload our securities.

I hope Neil Bush has taken this into account or the bush family fortune may go up in smoke... then again that is not that bad of an effect.

[Old and In the Way]

15. Trouble for China.......who wants to buy our debt they are holding?

I'm sure the Bush family has diversified out of the US market.....they've been selling us short for many, many years. It sure would be interesting to see where the Republican financial investments are these days.

[nadinbrzezinski]

24. Actually China has played an interesting game

of economic warfare and they are winning....

They actually can unload our securities....

Oh and as to the bushies yep they invested away from our economy a long time ago

You may find this funny, other day I called the broker

Conversation went something like this.

Hey I want to sell my T Bills

Why

I don't believe that the US Govermnet will pay them when all is said and done

That is going too far

Why? This is what Norquist promised to do two years ago....

I hope, not too many people are paying that much attention or the securities market may just very well crash, so where do you want to go?

GOLD.

[Nordic65]

71. I don't think we know it all

Think about it, the nationalism are an order of magnitude bigger than in the US. Five times the population, and economically rapidly catching up. Think about it!

Long term the US hegemony in the world has to wane, and it's gonna be very painful...

[alfredo]

28. There is legislation in congress to make it more

difficult to see where government officials have their money.

It could also be a way to hide their wealth for if or when they are charged with war crimes.

[nadinbrzezinski]

29. They DO LOVE open governent, don't they?

as long as it is used against them dirty Democrats.

I just ask what the Chenney are you people hiding?

[alfredo]

43. My new push is for people to

relax and enjoy Fascism. So for the next few days I will come up with fliers to make sure people can understand and accept a new way of defining freedom. Fascism takes away the worry of self government. We don't need to know the dirty details of what our leaders do, or where our tax money goes.


Remember, it is not a lie, if the speaker is the messenger of God.

[canadianbeaver]

45. Speaking of the Messenger of God -

shouldn't someone be placing a straight jacket around Dumbya..I know there are people who get messeges from God in places all around the US and I think he should be placed there as well...fairness and equality they say...OH YEAH.. Times have changed!!

[alfredo]

49. No, worship him for his godliness

[canadianbeaver]

50. EEEWWW PLICK PLICKKKY - won't and don't have to

I refuse to follow someone who thinks he's GOD sword...whether he be the US prez or our own PM...

Does God have a sword?

Love Rules!!!:loveya:

[alfredo]

51. Weird isn't it?

I believe this is how us DU'ers see bush.

[VegasWolf]

53. A sword? Wouldn't god have like at least a M16? Sword is so 3rd century.

[donkeyotay]

55. "EEEWWW PLICK PLICKKKY" ????

I'm not sure about the translation, but I love it.

Lookie here, Beaver, what we have here is liberals fomenting class warfare. When the upper-class screws the working-class that's called "business." When someone actually points out that the working class bears the burdens while the ruling class profits, that's called "class warfare." Now go back to your socialist country and be quiet.

:evilgrin:

[canadianbeaver]

58. Won't and don't have too!!!

One thing I am unable to do is keep quiet....EvilGrin -Donkeyotay.

Have an excellent day!!

Peace Out!!:hi:

[Thor_MN]

62. Is that what this is all about? God compensating for a sword that doesn't

work? Dang, get a Ferrari and be done with it already..,

[Gyre]

69. God's got a sword thats < 6' long?

How worthy of respect is that? :)

Gyre

[tavalon]

77. I dunno

ask Condi.

[tavalon]

76. God's Moron n/t

[ilovenicepeople]

32. I thought of a caption for that Walmart picture.

BECAUSE SOMETHINGS ARE MORE IMPORTANT THAN DEMOCRACY!

[whistle]

7. Where inflation is like an invisible tax, the dollar devaluation against..

...other currencies is like rationing during wartime. Foreign goods become more expensive almost overnight and those goods and services we were buying or contracted for, suddenly are costing much more. The long range solution is to go to some other country to buy what we want, but in the short term, those for whom the goods and services got too expensive must now do without while the better healed financially, just bite the bullet and pay the difference. The U.S. can suddenly find goods in Mexico more attractive because they are cheaper, but does a wool suit made in Mexico compare to one from Italy or France? I have my doubts. Europeans in the common market countries are what 475 million affluent consumers, they are obviously finding what American has to sell, less attractive, because they are accumulating far more American dollars than they seem to want to spend. Not a very good sign, but clearly something that Bush has allowed happen. What's next? U.S. dollar in free-fall, coming soon.

[juslikagrzly]

8. Is the * cartel doing this on purpose??

Economics is definitely not my forte, but it seems like their policies are designed to create the downfall of our economy.

I just can't figure out why? Consolidation of power to the wealthiest?

[Hello_Kitty]

16. That's what I'm thinking

It's their idea that they can 'shock' us into doing away with the public sector and privatizing everything. It was their ultimate economic goal in Iraq. Not working too well there but that won't stop them from trying it here.

[happyslug]

40. No, such a plan requires Thought

Something lacking in this administration. No, Bush plan was to take the Persian Gulf Oil and use it as a hammer on the rest of the world. Bush and Company believes that once he controlled the oil, nothing else matters.

The first problem is our economy is more than oil. Europe and the rest of the world knows this. On the other hand oil is the fuel modern economies run on. Thus Europe wants the oil from the Persian Gulf also but Europe knows that oil is a fungible good (i.e. can be purchased anywhere and sold anywhere) and thus you can buy it only if you have a strong economy.

Thus the fight between Europe, China and the US. The US can NOT Strengthen its Economy without reducing Military Spending. Europe and China are unwilling to increase military spending if it weakens their economy.

This was a very balanced act under Clinton, for he kept up the Military but refused to seriously commit it anywhere (he went into the Bosnia only after the Fighting had stopped, and made sure NATO was weapon of choice in Kosovo). Bush has now committed the US Troops to Iraq (Bush has made no similar commitment to Afghanistan no matter what he says). The problem is the Iraqis are not rolling over and playing dead, they are fighting and tyeing up the US military. Thus the US advantage, its Military has been neutralized leaving the world open to dominance by the Economic giants of Europe and China.

To get out of this fix, Bush either has to withdraw (and admit his plan for dominance has failed) or continue to try to conquer Iraq and its oil. Thus Bush will sacrificed EVERYTHING for the war in Iraq. The destruction of the US Economy is NOT his plan, but he ill DESTROY everything to save his plan to control the Persian Gulf. Thus unless Congress does what the Democratic Congress of 1974 did and force him to withdraw, Bush will wreck the economy, the military, and everything else to "win" his war in Iraq.

As to the GOP congress doing what the Democratic Congress of 1974 did, I have my doubts, but only Congress can prevent a full melt down of the economy. Congress is up for reelection in two years and the fear of losing may force their hand, but Bush will NEVER back down, the Courts will not stop him and Bush care less for people's protests (Through Congress does).

[GHOSTDANCER]

17. We got to bankrupt it. We can't pay all those people back. come on???

Clinton sold half of America to China and the Bush Cabal is selling the other half to the Middle East.

[Dems Will Win]

47. They envy the Rockefellers, who bought up the US cheap in 30s

[CAcyclist]

68. It Also Hurts Europe

You've probably noticed conservatives calling for Europeans to "modernize" and "reform". If their factories are squeezed because Americans can no longer afford European imports, they may be more susceptible to the ploy.

[CHIMO]

9. Flip Flop

Signal is we want a lower dollar.
Guess what.
There will be a lower dollar.

[cliss]

10. As John "Snowjob" Snow visits Europe,

he bullshits his way through the lectures. He turns the focus away from the US plunging over the abyss, and takes a look at Europe and how they're handling things.

NOT ONE of the European countries believes anything he says. As they watch their export industries shrivel, he stands up there and blows hot air.

He says he supports a strong dollar, but stands to the side and watches it go into rigor mortis.

On a side note, my poor boss has planned a 3-week vacation to Italy next July. He ordered his hotel rooms about 2 months ago. This was long before the dollar tanked. His room is charged in Euros. Every time he checks his room rate, it's gone up once again.

He's getting frantic. I think the last time he checked, the room was $200.00 per night. As the Treasury stands idly by, twirling their thumbs and whistling....

[kuozzman]

19. ``Single acts of tyranny may be ascribed to the accidental opinion.....

of a day, but a series of oppressions, begun at a distinguished period, unalterable through every change of ministers, too plainly prove a deliberate, systematical plan of reducing us to slavery.''

-Thomas Jefferson

[msgadget]

18. I liked it better

when he pretended he didn't know it was weak. I even wondered if he purposely made the other side of the world nervous with his bold propositions right after the election so it could lurch a little more downward. I never expected an explicit sell signal.

Does anyone know how Snow would correct this if he overestimated the affect of a totally sunk dollar? Would he have to go make nice-nice and ask them to, 'puleeeze buy some dollars back now'?

[Tight_rope]

22. "The dollar plunged to an all-time low "?....AGAIN....How low can we go?

[nadinbrzezinski]

25. We have not yet hit the possible basement

but we are close.. after that reach for yer good ol' backhoe

Does the term FREEFALL have any meaning outside of theory for you? IT does for me... I went through this wiht the Peso many years ago

[Stinky The Clown]

26. Can you say "PetroEuros"?

When that happens we'll be worse than Argentina.

[nadinbrzezinski]

27. Oh you are oh so possitive!

By the way, how many of them Bush suporters do you think will be shocked when this happens and well... blame it on clinton.

;-)

After all NOTHING can be the Emperor's fault.

[Coconut Buddha Ape]

30. I never thought I would say this...

But one good thing HAS come about from Bush's policies...

"Good", if you happen to need to pay off debt that is held in dollars with a foreign currency.

Like me.

And the rest of the world.

::sigh:: It's not much of a silver lining, but it's the only one I got.

[aneerkoinos]

33. Face it people

Federation is lost cause, you can't beat the regime before it unravels the Federation. Accept the reality and kiss USA goodbuy.

The way to go is autonomy, making the regime irrelevant. You can act on personal, local and even State level, build networks of mutual assistance and information sharing, adopt local currencies and reinvent local production, ecologically sustainable. The way of Argentina, you can do better. With the Federation you should also kiss goodbuy the Democratic party, for most parts at least. Greens are still fresh, there is allready some knowhow and open to creative ideas about building autonomous structures, but the whole thing isn't about established parties, it's about surviving and building democracy from scratch, authentic democracy.

[SayitAintSo]

57. Been listening to Titor ? n/t

[aneerkoinos]

59. Who is Titor? n/t

[Donkeyboy75]

34. Glad I'm getting paid in Euros.

But my savings are in dollars. :(

[pippin]

35. . . .and the economic outlook for the next two years

is supposed to get better?

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x999554

gimme a break. :crazy:

[wicket]

36. why are they doing this??

Can someone explain this to me- I don't know very much about economics.

[Gingersnapsback]

37. I wonder whtat Sorros is thinking?

[aneerkoinos]

41. Deep down

Because of growth-based socio-economical model that they - we - can't think of any alternative to. Grow, even if you have to cheat to do that, grow, no matter the cost.

And the closest analogy to growth-based model in our bodies?

... you guessed right, cancer tumour.

[Brand New Tico]

38. The world is finally punishing us - thank God!

America has flipped off the world for too long. Now the world is punishing us. They aren't buying our bonds, and they are dumping our currency. Thank God they are finally giving us what we deserve.

[natrat]

44. somehow i dont think we, people w/ blue state mentality, deserve

what seems mat be coming our way

[tavalon]

78. While on some level, I get what you are saying

how happy are you going to be when you don't have a job, food, or shelter? How good are any of us, fat, lazy, conspicuously consuming Americans going to be at being third world people fighting for the bags of rice from the international relief agencies?

[Lydia Leftcoast]

46. Whoa! The yen rose 1.30 yen against the dollar since yesterday!

:wow:

This is good for me personally, since 90% of my customers are in Japan and pay me in yen, but this is terrible for anyone who buys electronics or Japanese cars.

[bushisanidiot]

48. Republicans absolutely CANNOT be trusted to handle money

it infuriates me that they have power over our tax dollars!

[Comadreja]

56. Who sez they handle Money?

[Javaman]

52. When the dollar falls low enough,China will start calling their US t-bonds

Then we are all fucked. They have close to 1 Trillion dollars invested in T-bonds. I bet you with the debt ceiling being raised, they are going to dump some. Then the value of the dollar will really plunge.

[Gay Green]

64. Then the value of the dollar will really plunge.

And after that they may insist that we pay them in hard currency, examples: euro, pound, yen, yuan, peso, rupee, ruble.

[Comadreja]

54. It is all in God's Hands, Amen

Our Regent knows more than we, and the Lord works in mysterious ways; we cannot search them out. The dollar says "In God We Trust" so we have faith that all things will work to His glory, including the deficit. The ones whom God has blessed with prosperity deserve to keep what the Lord has given, and Scripture says: "To he who has much, more will be given, and he who has little, even what little he has will be taken away." So you see, our Regent and God's Own Party have done much good, and the heathen fall back in fear from His terrible swift sword in Iraq.

[struggle4progress]

60. kick

:kick:

[fedsron2us]

63. There is a dangerous game afoot

Although Snow says he supports a strong dollar policy, all the evidence suggests the US administration wants to see the currency drop. Bush clearly intends to use devaluation as away of reducing the cost of the public and current account deficits. The view is that if the Europeans and Asians find a weak dollar hurts their interests then that is their problem. The US can only get away with this form of larceny because the dollar is the reserve currency. Any other country that tried this trick would pretty soon find their currency in free fall. They would end up having to use their gold and foreign exchange reserves to stem the decline. Upto now the regime in the White House has not had this problem. When the dollar has looked likely to implode Asian governments have stepped in to buy it. This has meant that the main burden of the dollars fall has fell on the Euro zone. Now European central banker are considering whether they too will have to intervene in the market to sell their own currency and buy the dollar. Thus, the US government has achieved the neat trick of getting foreigners to pay for the smoothing of the dollars devaluation with their own hard earned cash. All the Fed and the administration have to do is ensure that the printing presses keep churning out the dollar and T-bills. The Asian and European governments need to wake up to the fact that their current policy of propping up the dollar is playing into Bush's hands. It allows the US government to evade its responsibity for some of the imbalances in the world economy and enables it to pursue a policy of miltary adventurism that in normal circumstances it simply could not afford. My advice to foreigners would be to stop buying the buck in an attempt to prop up their export industries. Instead, they should actively sell the US currency to precipitate a global FOREX crisis. Once Washington finds out that they can not rely forever on the suckers to bail them out then I think that the Bush administration may find that it very quickly has to cut back on its plans for world domination

[Gay Green]

65. Foreigners, take fedsron2us' advice

And dump that dollar!

[oblivious]

70. Damn scary business, but you're 100% right. nt

[aneerkoinos]

72. No worry

US is no competition to EU even with weakening dollar (and yuan). In 2003 EU-China trade caught the same level as US-China trade, and surpasses it widely this year, even if the EU enlargement is not taken into count. So EU is now China's biggest trade partner, with deficit that is not nearly as bad as US deficit, while US is number one source of direct investments (read outsourcing).

So what will happen if China uppegs yuan from dollar? EU exports to China, that have been doing well relative to US even under unfavourable currency movements for three years (euro strengthening against dollar-pegged yuan), will become even more competitive as yuan stops dropping against euro. And same for Japan. Dollar takes the free fall alone, destroyed middle-class can't afford the now more expensive wall-mart shit from China, but the ruling class of US still keep buying their posh luxury products from Europe. All you bases are belong to us.

[54anickel]

73. China's no fool in this game.

snip>

In their 1999 seminar treatise entitled, Unrestricted War: China’s Master Plan to Destroy America, Colonels Qiao Liang and Wang Xiangsui state that in order for China to become a dominant global power over the United States, “The Final War over Resources”, must be successfully concluded.

Though this could be easily blown off as People’s Liberation Army hyperbole, a closer look at the facts shows us that the United States is in a very vulnerable position on a number of fronts with China. And so with it, is the U.S. dollar.

As long time readers of the OI news know, the resurgence of gold and the fall of the dollar have a multiple factors working together. Going forward into 2005, China’s “final war for resources” will be a key factor in the further depreciation of the greenback.

The U.S. government has been keeping a lid on the brewing problems with China because of the delicate situation which has the Chinese central bank holding billions in U.S. dollars and treasury bonds which Washington fears they might sell.

snip>

The writings of People’s Liberation Army Colonels Qiao Liang and Wang Xiangsui, state that the aggressor nation “must adjust its own financial strategy, use currency revaluation or devaluation as primary weapons, and combine means such as getting the upper hand in public opinion and changing the rules sufficiently to make financial turbulence and economic crisis appear in the targeted country or area, weakening its overall power, including its military strength. Whether it be the intrusions of hackers, a major explosion at the World Trade Center, or a bombing attack by bin Laden, all of these greatly exceed the frequency bandwidths understood by the American military..."


http://www.kitco.com/ind/Ridley/printerfriendly/nov182004p.html

[fedsron2us]

74. Agreed. China's peg between the dollar and the yuan

blows a big hole in the US government geopolitical manipulation of the forex market. As the Chinese currency is not freely exchangeable they are not forced to intervene in the markets to maintain their trade advantage with the dollar. Their main problem is that they have to increase the supply of the yuan to match their US currency holdings. This causes quite a lot of inflationary pressure in the Chinese economy. The Chinese are still very dependent on the US export market to maintain growth. However, their are signs that they are now looking to develop domestic consumer demand underpin their economy. They are also starting to use their foreign exchange earnings to acquire valuable resources around the world. I think they may soon be unloading their dollar assets. This may be why Snow has been spending time in Europe trying to scare the natives. A dollar crash will be far less likely if the Europeans can be forced into paying to smooth the dollars decline. The Bush administration may also have plans to inflict so much pain on the Euro zone that some countries will be tempted to quit the currency altogether. At the end of the day this process is as much about the political balance of power in the world as it is about economics.

[Junkdrawer]

67. Is there anywhere one could track a flight from the dollar?

In other words, is the slide due, at least in some part, to supply and demand?