US Dollar will collapse!

[redy2quit]

What will it mean for Canadians when the US Dollar collapses?
If their at .45 cents to our .90 will they flood the world with cheap products like grain etc. Fertilizer is based out of the gulf in US dollars will it translate into Cheaper Canadian prices. OR will we crash and burn like them.
Simply I am starting to believe that were in for one hell of a ride on the Markets. Grain and Financial. Hm wouldn't it be funny if Cargill Viterra or Pioneers checks were no good for our grain because they couldn't get financing for themselves.
Maybe that's why there all pushing for farmers to prepay for products when booking!
No one knows for sure whats coming but if one is a betting man maybe building cash reserves and watching spending is the way to go in 2009.
Buffets doing it, he pulled money in good times and now is purchasing companies when times are poor.
Its hard to find a buyer for a $500,000.00 air drill if the sht hits the fan.
Land always has a value, but expensive property will drop.
Will housing prices stay high in the Cities if their are lines of unemployed.
What month will the reality hit that all the money pumped into globe to save companies was for nothing.
Why didn't the USA Canada Europe Dubai etc look at history, Japan had the same problem some 12 years ago or more and they still haven't got back into the full game.
I hope I am wrong.

[nicolaas]

yea, we're in for one heck of a crapstorm. I locked in my fert recently, and wish I could go back in time already. I am getting cold feet.

[Fransisco]

At some point interest rates will really start to jump in an attempt to counteract a dollar in freefall.

[redy2quit]

Why cant we learn from history. Or the ones who were their last time are two old to tell the few who would listen. The rest are to young and cant see it coming.
Try 22% interest on your fert bill and operating?

[vvalk]

Why will the US dollar collapse? What makes you think the US is worse off then the rest of the world. In fact I think the US is in much better shape then many European and south east asian countries. As for 22% interest rates. It won't happen. We are in a world economy and we won't get there. Maybe 10%. Maybe. We are in a deflation economy right now. If we do go to 20%, great. Look at all the money you will make just leaving cash in the bank.

[SASKFARMER3]

VWalk its called Trillions in Debt with printed US Treasury bonds.
Their Screwed.

[vvalk]

its all relative to the size of the economy. Its been talked about for months now that the US is NOT in as bad of shape as many other economies. I think you will see money flow into the US dollar and it may strengthen, not weaken. There is no sign of inflation either.

[SASKFARMER3]

Listen and read http://www.newhavenindependent.org/archives/2009/02/netroots_promot.php

[cottonpicken]

You probably failed history class vvalk.

The usdx has lost 96% of its purchasing power.

You are right though that all other currencies are losing purchasing power and help keep the usdx looking good.

All except one.

[cottonpicken]

Good article Sask.

If anybody wants to know what a real CONSERVATIVE looks like find out about Ron Paul.

[classicalliberal]

better hedge some interest rates here soon.

[vagabonddreamer]

i am curious...i would have thought that the gov'ts of both US and Can...would actually live with inflation for a while..and not touch interest rates...every financial pundit is telling people to save and pay down debt...if everyone does that to the nth degree...wont a further slide into recession/depression be a self fulfilling prophecy?? do you reckon that massive DE-flation is a better alternative??

i tell ya why i think the US will continue to throw money at this thing...Obama's handlers DONT want to see the US crumble when the "watch" belongs to the first black president of the US...can you imagine what the rednecks would do sensationalizing THAT?? I am not saying you guys are WRONG...i am just wondering which is better deflation or inflation?? vs

[cottonpicken]

Depression and inflation can exist at the same time.

Deflation is scary to everyone in these times because of the amount of debt in the system.Housholds and governments are maxed out.Paying off debt with expensive dollars would be IMPOSSIBLE.We would be talking complete implosion.Businesses go broke,tax revenues collapse,governments cut everything in a viscious downward spiral that feeds on itself.

The path of least resistance is inflation(cheap dollars).Not that major problems dont live here either.


Interest rates are suppose to follow the bond market,Key word SUPPOSE.

When things become unclear is when a government prints money to by its own bonds to keep rates low.You might as well through economic theory out of the window because this screws everything up completely.

And yes this is happening now in the us bond market.

The lack of reliable information makes the future very unclear.They have openly lied about inflation for years and have even gone as far as cutting off m3 numbers.

I doubt government is going to get smaller anytime soon.

[boarderbloke]

Anybody read this over at " The Market Ticker " regarding AIG and China's involvement with the bailout money?

http://market-ticker.org/

You will find it posted on Feb.23, if it doesn't come up as the most recent posting there.

Makes me think the US dollar will stay HIGH, Because China would lose too much with it's investments in the US and it's treasury holdings. China won't want to be repayed with cheap valueless US$s


Question??? Does keeping the US$ high also keep commodity prices lower??? If China uses US dollars (from it's US investments) to purchase imported commodities, food costs would be lower than if the US dollar dropped. Agree???

[boarderbloke]

Quote: from the comments


Obama Sells U.S. to China Inc.
AIM Column
By Cliff Kincaid
February 22, 2009

The truth is starting to seep out. Because of the need for more money to finance the latest bailout―the Obama economic stimulus plan―America is going further in debt to the Chinese Communists. Our country is officially being sold to the highest bidder. And we have striking confirmation of this fact from Secretary of State Hillary Clinton.

The good news is that a correspondent for the mainstream media―Wyatt Andrews of CBS News―has figured this out and has managed to get on the air with his terrifying findings. Andrews’ report on the Friday CBS Evening News with Katie Couric was direct and to the point. Clinton is in China to beg for a handout.

“The truth is the Administration needs China’s help. America’s stimulus is very expensive and the U.S. wants China to help finance it,” Andrews reported. This is what America has become―a country that sends its Secretary of State abroad to beg for money from foreigners. In this case, it’s a communist dictatorship that forces women to have abortions, tortures Christians, and threatens the freedom and democratic government of Taiwan.

So the cost of the “stimulus” is more sacrifice of American independence and sovereignty, as well as our own values, ideals, and commitment to human freedom. It is a sad day both for America and China. Clinton was shown saying, “We are relying on the Chinese government to continue to buy our debt.” The almighty dollar takes precedence over everything else, even as it falls in value and the dangers of hyperinflation and national bankruptcy loom. The tragedy is compounded by the fact that pandering to the Chinese will not solve anything. This policy, set in motion by big banks and corporations and pursued by Democratic and Republican Administrations, is what got us into this predicament in the first place.

Clinton’s comments, which concern the overall economic policy of the new administration, are far more significant than the Obama mortgage plan. Clinton is getting to the heart of the issue―how the mortgage plan and the stimulus are being financed. White House spokesman Robert Gibbs expressed irritation last week that CNBC commentator Rick Santelli went into a rant over the prospect of forcing American taxpayers to underwrite the bad mortgages of deadbeats and others who are unable to pay their mortgages. But Santelli only touched on one small part of the problem.

Where’s the outrage over the pro-China policy that spans several administrations, and which has benefited his corporate bosses at General Electric, of permitting the communist dictatorship in Beijing to have the upper hand in global trade relations? All that Santelli has to do to understand this problem is attend a GE annual meeting and listen to the complaints of the GE workers losing their jobs to China. But don’t expect to see anything about that on CNBC, NBC, or MSNBC.

If you want more information on this travesty, please go to the website www.screwthatbulb.org and learn how GE is going “green,” which has the effect of shipping American jobs to China. If Santelli did a rant about that, you can bet he wouldn’t be on the air again. We were already in terrible shape under the Bush Administration because of a mysterious financial collapse apparently caused by illegal manipulation of our markets, but now the communists have us completely over a barrel because the Obama Administration, with the acquiescence of Congress, recklessly decided to spend even more money that we don’t have. Under the circumstances, this is criminal negligence.

Mrs. Clinton is officially stating what everyone should know is the truth. She deserves credit for being brutally honest. America has become a subsidiary of China Inc. In order for the U.S. to stay afloat, we have to depend on Beijing to finance a bailout. But the other major problem, of course, is that the stimulus is not a bailout in any real sense of the word. It depends on more government debt and borrowing at a huge cost of being more indebted to the Chinese. So the bailout is really digging our nation’s grave deeper.

To make matters even worse, as the Andrews report made clear, the cost will include the jobs that the Obama Administration says will be created by the stimulus. He interviewed an American manufacturer about the loss of American jobs caused by China’s trade practices, who said that the “cheating” in global trade has cost millions of American manufacturing jobs. In the end, the only “jobs” that will be created or “saved,” as Obama likes to say, will likely be those benefiting from spending the federal money that the federal government doesn’t have. Most of them work for government at all levels.

Productive private sector manufacturing jobs will not be created―and cannot be―because despite their campaign promises, neither Obama nor Hillary will do anything about those unfair Chinese trade practices, such as the currency manipulation, that make Chinese goods artificially cheap and American goods more expensive. The Andrews report, which caught me completely by surprise on a newscast that tends to portray the new Administration in completely flattering tones, was absolutely blistering in contrasting what Obama and Clinton had said during the campaign and what they are doing now.

“Both the man who became the President and his future Secretary of State told the voters they would make the [trade] cheating go away,” Andrews reported. He showed candidate Obama saying that he would do everything in his power to stop China from manipulating its currency and Hillary saying that she would “aggressively crack down on China’s unfair trade practices.” These claims were shown to be empty and abandoned campaign promises. We should have assumed that would be the case. Andrews asked Secretary of State Clinton about this and “she explained that times have changed.” Clinton said, “That was at a different time when we weren’t facing the kind of difficult situations we face today.” Translation: we need their money and we are in no position to demand or criticize anything. These Clinton comments preceded Andrews’ remarks about the cost of the stimulus and the perceived need to get China to help finance it.

As we had noted in a previous column about the Administration’s so-called economic program, Clinton was going to China for the purpose of getting Chinese money to finance the stimulus. Now we have it all on the record. Her trip was designed to reinforce Treasury Secretary Timothy Geithner’s private conversations on this topic with Chinese officials. The land of the free and the home of the brave has now become the land of the quivering milquetoast, in awe of an emerging Communist giant that our big banks and corporations, as well as our government, have built into an economic superpower. President Obama apparently sees nothing wrong with this. Indeed, during the campaign he praised China’s staging of the Olympic Games, saying their infrastructure was impressive and was something the U.S. might consider emulating. Now, with Hillary Clinton having signaled to the Chinese dictators that we will beg for their money and ignore unfair trade practices and even human rights violations, it will be left up to President Obama to seal the deal. When he gives his State of the Union-like speech to Congress and the American people on Tuesday night, he will in reality be auditioning for a front-row seat on the board of directors of China Inc. Don’t expect to hear anything critical of the butchers in Beijing.


-Greenberg was both a social friend and client of Henry Kissinger, utilizing his consultancy, Kissinger Associates, for advice and operations in a number of countries, particularly in Asia. In 1987 he appointed Kissinger as chairman of AIG's International Advisory Board. (add) It was Henry Kissinger, the former Secretary of State, who advised against harsh sanctions after the Tienanmen Square massacre. „No government in the world would have tolerated having the main square of its capital occupied for eight weeks by tens of thousands of demonstrators,“ he wrote. The conduct of the students made a crackdown „inevitable“, he added. http://en.wikipedia.org/wiki/Maurice_R._....

-Mr. Greenberg is former chairman, and currently serves as a trustee, of the Asia Society. He is the founding chairman of the U.S.-Philippine Business Committee and vice chairman of the U.S.-ASEAN Business Council. He is chairman of the U.S.-Korea Business Council, and a member of the U.S.-China Business Council and the Business Roundtable. He is past chairman, deputy chairman and director of the Federal Reserve Bank of New York.
http://www.cfr.org/bios/576/maurice_r_gr....

-Greenberg lobbied hard (and successfully) for the Clinton administration to sever the link between China’s human rights record and renewal of China’s Most-Favored-Nation trade status.

of interest:
-Geithner is a former Kissinger Associate.
-Wolfowitz is now the president of chairman of the US-Taiwan Business Council.
-AIG is also the largest Insurer in Taiwan. (partner with Nanjing LIfe).
-China joined the WTO on Sep 10,2001.
-Anything to do with Kissinger & China is bad news for Taiwan.

Add this Feb 22 story from AIM (Accuracy in Media):
http://www.aim.org/aim-column/obama-sell....