Easy way to restructure where the paper sits

[Klause]

1. Cause every consumer to be borrowed to the hilt. (check)

2. Rapidly inflate the currency to where it's worthless (getting there with how fast our dollar is dropping).

3. Wages adjust for inflation. (working on it, not going so well).

4. Interest rates drop to 0 or less (check).

5. Over night, hyperinflation is banging at the door.... now banks, investors holding bonds, etc. won't be able to work fast enough (having never had to deal with it before)... So they won't be able to index loans fast enough... at which point your paycheque might have more zeroes than your mortgage... All that paper is now worthless, and the average joe schmuck is out of debt... The looser? All the holders of paper.


A total collapse of our banking system, and then the rebuild makes everything right again.


You're going to say this can't happen... Well, it has happened. It happened in the Weimar republic. It happened in Argentina 3 times... Paraguay twice.


Food for thought

[cottonpicken]

My number is over six hundred times.

Even in the states they had to reprice gold from 20 to35.

75% default overnight.

Mexican tequilla crisis. Government saying everything was fine then wammy

[ajl]

Another scenario: all this dollar denominated debt is creating a massive demand for dollars and deflation ensues. This is happening in $USD right now. I think the $Cdn will disappear over the next 30 yrs so we have a different experience. By the way private sector wages are not keeping pace with inflation. 30 yrs from now the only we will be like Zimbabwe where they use the rand and $USD as there own currency is worthless. Now the rand is also worthless as will the $Cdn be. Hoping for one more oil price rally to buy more $US but it now looks like SOL.

[iceman]

Question for Klause

If this is a possible outcome to this mess would you still forward contract grain or contract past the front month?

Over & Out

[iceman]

Aji

The only requirement to being the world's reserve currency is to control the seas

Being the world's deep sea navy and it's your dollar that's king.

Over & Out