I keep trying to get my mind around this thing and it''s hard. Has the dollar been going up not only because of the weak euro but because all the buying the Fed is doing is based in dollars and so everyone converts to sell their stuff to the Fed? BUT as soon as the Fed quits, everyone runs out of the dollar because of the sizable U.S. debt . You would have deflation while everyome is selling the junk, but quick massive inflation when no one wants to take dollars for their goods.
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2 replies to this topic
#2
sss355
Black Bear Posted 04 October 2008 - 08:43 AM
because the dern ferners need $ to pay off those CDS that have exploded.
#3
5to12
Brown Bear
Posted 04 October 2008 - 01:15 PM
global financial system on one hand, national monetary authorities on the other = an inherent tension. Crank that up with globalizing recession and financial failures and we get the typical rush to cash. Which currency unit is still the closest to a contractually required world money? The USD.
Now, should global finance break apart into national units, ie., a complete change in structure, the above comes apart.
A.J.
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