Posted on 09/17/2012 9:51:08 AM PDT by justlittleoleme
The mainstream media in the United States is almost totally ignoring one of the most important trends in global economics. This trend is going to cause the value of the U.S. dollar to fall dramatically and it is going to cause the cost of living in the United States to go way up.
**SNIP**
Since so much trade is done in dollars, there is a constant demand for more dollars all over the globe from countries that need them for trading purposes. So the Federal Reserve is able to flood our financial system with dollars without it causing a tremendous amount of inflation because the rest of the world ends up soaking up a lot of those dollars.
**SNIP**
China and Russia have been spearheading a movement to shift away from using the U.S. dollar in international trade. At the moment, the shift is happening gradually, but at some point a tipping point will come (for example if Saudi Arabia were to declare that it will no longer take U.S. dollars for oil) and the entire global financial system is going to change. When that tipping point comes the global demand for U.S. dollars is going to absolutely plummet and nightmarish inflation will come to the United States.
**SNIP**
In fact, China and Russia have been working very hard to move us toward exactly such a scenario.
**SNIP**
Just the other day, China and Germany agreed to start conducting an increasing amount of trade with each other in their own currencies.
You would think that a major currency agreement between the 2nd and 4th largest economies on the face of the planet would make headlines all over the United States.
Instead, the silence in the U.S. media was deafening.
(Excerpt) Read more at theeconomiccollapseblog.com ...
The US has doing that all by itself and now they want to join in?
They are only acting rationally from their perspective. Bernanke is cutting the legs from under the dollar and the BRICs are just trying to protect themselves - maybe with a little schadenfreude thrown in.
After 4 years of the Empty Chair in office, I would expect nothing less.
Its too bad that Russian, Chinese and Arabic will be tough languages to learn. Oh, and that Freedom and Liberty thing... that will be missed by ‘some’ of us.
OBAMA HAS GOTTA GO or this nightmare will NEVER get turned around.
Thanks. Well put. You saved me from the trouble of writing a similar post.
Russia and China owe NO allegiance to the US Dollar. Thats OUR job. As exporting nations, Russia (oil and gas) and China (manufactured products), would be insane to keep using the dollar.
The dollar can and is being devalued. It’s lost tons of purchasing power even since 2000. If russia and china got caught hold them, they could quickly find their accounts worth half of what it should be.
Inflation is theft.
If we are going to have a fiat currency, then we had better not debase it by printing it into oblivion.
Otherwise, people in other countries will sanely demand payment in a gold backed currency. This will crash the dollar when it is no longer a reserve currency.
But,,,this is the plan anyway. Right Obama? 2016 laid it out.
What are they doing that Bernanke isn’t doing? He is devaluing the dollar to what a quarter used to buy. This will help us discount the $60 Trillion+ of debt so that we pay the interest with cheap dollars.
Some how I don’t think the Chinese are going to go for this arrangement. Maybe they’ll take NY or CA as collateral when they foreclose on us. So some good could come out of this disaster.
Precisely! Money is only a medium of exchange. As such, its real value, like all other goods & services, is dependent upon supply & demand. If you increase the supply, you reduce the value of each unit. While the effect will usually be masked--often for as much as a decade--the damage to real exchange value, in the case of what has been happening here, has already been done.
See Medium Of Exchange.
What the Fed & the Administration have been doing, in applying the Economics Of A Sociopath, has been to plunder the value of all personal & corporate wealth, held in Dollars, anywhere in the world, in order to try to create the illusion of economic progress. No ancient Comedy ever more truly captured the absurdity of wishful thinking & delusion driven behavior, than the antics of the Keynesians in the present era. We are going to pay a terrible price for this--more terrible with every passing day, in which it is not arrested.
William Flax
I wouldn’t put it past Vlad Putin, but China has too much to lose. Civil order in that country rests on the next container shipment to Dollar Tree.
Of course demagogues will look to blame anyone & everyone, but the actual culprits in Washington.
William Flax
You can’t blame a sovereign nation for acting in its own interest. Nations do not have friends; they have interests.
Bernanke has been actively screwing anybody who holds USD for quite some time. He thinks this is in the interest of the US. The Chinese hold a lot of USD, and their interest is in maintaining the value of their sovereign wealth, not that of the USD.
Gee, and I thought the Fed had a dual mandate to preserve price stability and high levels of employment. Are you saying that the Fed is a colossal failure? You sound like Ron Paul, and every good conservative knows he’s a nut!
/sarc
(Most in Congress were misled by the same Academic Quacks who indoctrinated the talking heads in the Broadcast Media. But the "funny thing" is that all the fantasy seeking theorists have never yet disproven the fundamental understanding that was so clearly witnessed by Adam Smith and the Founding Fathers of America.)
And those smearing Ron Paul are hardly Conservative economists or Constitutional scholars. (And by the way, Dr. Paul has managed to line up a clear majority in the House of Representatives on the need to do something about the Fed.)
William Flax
Pikers!
The FedResv is doing a fantastic job of that all on their own....
Obama borrows 6 trillion and they keep printing money and they think that won't lower the value of the dollar? These Marxist morons have no clue. The dollar will be worthless soon thanks to democrats, Obama and the media
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