BF2S Forums Italy slashes US treasury bond holdings for UK ones.

Jenkinsbball wrote:

Right, I'm sure the billions and billions of dollars we've loaned them have been paid back. If we called back all outstanding loans due to our government, we'd bankrupt the planet.

I'm not saying that anyone owe's us money back for us giving money for them to rebuild their country, but I'm sure we've given plenty after that.

Sure, the many trillions our government owes the world means nothing, right? If anything, we probably owe them money.

Cool! I mean, if the dollar goes down, what's to stop me from ordering tonnes rare CD's and movies instead of one or two?

Now, Americans, this is my advice to you if you're afraid for what money you have. Buy gold, like Jimmy said. Get something of value other than numbers in a bank. Like a house. Use your capitalism.

Last edited by Janysc (2006-09-02 00:51:54)

JimmyBotswana wrote:

Rosse_modest wrote:

Bertster7 wrote:

Gold is a nice solid investment. It doesn't move about much, but that also means it doesn't go up (*edit* - much, although it has gone up a bit lately). Invest in things you think will rise - gold isn't that great.

Hasn't gold actually declined in value over the last couple of years?

No.

http://www.kitco.com/LFgif/au3650nyb.gif

Well, that just sucks! I hate gold, it should be banned for anything but technical applications.

Means I am coming over there to spend my sterling and buy loads of goodies with my dollars.
You keep making my sterling worth more. GO ITALY

Spumantiii wrote:

pfft I'll take an informed man's word for it, obviously

turns out pfft was the sound of some one unloading in your pie hole, lol still waiting hahaha !

being a conservative means you are responsible for what you say. Long term.

Ok so from what you lot have said I get a summary along the lines of:
-US $ slowly declining.
-Now Italy hits it a little and other countries may follow suit further hurting the $ but making the £ sterling stronger and in turn the euro stronger.
-For a time Europe is happy and America is not so happy.
-But then this deflation of the $ ripples throughout the world market and brings the £ and the euro down.
-The Euro and the £ recover with the rate of inflation, but the $ simply suffers if it doesn't sort its economy out or if Asia pulls funding out of the $.
-If the $ collapses the world market suffers but isn't destroyed although America is going to be a hell of a place to live in.
-Asia being the power house economy of the future comes out shining after a few years and Europe continues to plod along with an uncertain future for the EU.
-Africa isn't involved and largely doesn't care.

Have I miss interpreted anything or missed anything out?
(my opinion: then history repeats in a century or two with US or Africa gaining power and Asia falling and Europe continuing to plod along)

sfarrar33 wrote:

Ok so from what you lot have said I get a summary along the lines of:
-US $ slowly declining.
-Now Italy hits it a little and other countries may follow suit further hurting the $ but making the £ sterling stronger and in turn the euro stronger.
-For a time Europe is happy and America is not so happy.
-But then this deflation of the $ ripples throughout the world market and brings the £ and the euro down.
-The Euro and the £ recover with the rate of inflation, but the $ simply suffers if it doesn't sort its economy out or if Asia pulls funding out of the $.
-If the $ collapses the world market suffers but isn't destroyed although America is going to be a hell of a place to live in.
-Asia being the power house economy of the future comes out shining after a few years and Europe continues to plod along with an uncertain future for the EU.
-Africa isn't involved and largely doesn't care.

Have I miss interpreted anything or missed anything out?
(my opinion: then history repeats in a century or two with US or Africa gaining power and Asia falling and Europe continuing to plod along)

That's not how currency markets work. They are all about demand, much like the stock market. If people buy lots of dollars, the value goes up, if people sell lots of dollars, the value goes down - likewise with the Euro, it's worth a lot because people want to buy them, the same is true of sterling. Domestically there is unlikely to be that significant an impact, except on imported goods.

It's not inflation or deflation. There is no deflation in the US. It is about comparitive values.
In fact inflation in the US is higher than in the UK, which in turn has higher (on average) inflation rates than the EU. There was concern about the level of inflation in the UK reaching 2.7%, in the US the rate of inflation for 2006 was 3.24%. That would suggest that the dollar will fall even further, due to the disparity in inflation rates between Europe and the US.

Last edited by Bertster7 (2007-05-29 17:13:43)

Bertster7 wrote:

That's not how currency markets work. They are all about demand, much like the stock market. If people buy lots of dollars, the value goes up, if people sell lots of dollars, the value goes down - likewise with the Euro, it's worth a lot because people want to buy them, the same is true of sterling. Domestically there is unlikely to be that significant an impact, except on imported goods.

It's not inflation or deflation. There is no deflation in the US. It is about comparitive values.
In fact inflation in the US is higher than in the UK, which in turn has higher (on average) inflation rates than the EU. There was concern about the level of inflation in the UK reaching 2.7%, in the US the rate of inflation for 2006 was 3.24%. That would suggest that the dollar will fall even further, due to the disparity in inflation rates between Europe and the US.

I am talking about a few years (5/10/15/20 years etc) into the future and not this year or the next, I know that atm the US has high inflation, but generally that leads to an economic shortfall in the future. Currency markets on the scale we are talking of generally have direct effects on country economy as well causing deflation and infaltion, so yes whilst the markets are about supply and demand the money made and lost from this largely isn't.
I only give my interpretation of events if you have one you feel is better then I am interested in hearing it.

Harmor wrote:

Is 3.4% inflation high?

It's about par for the course in the US.

Hunter/Jumper wrote:

The dollar is fine. It was a storm in a Tea Cup. For once I wish some would just admit they were wrong.

You're jumping the gun. The predictions made in this thread are not on a timetable. Stop trying to appear high and mighty using fallacious logic.

Funny thing is, if anything happens to the US economy...  such as  a crashing dollar.. (which BTW won't happen in our life times) the rest of the world would be fucked.  Who buys EVERYTHING????  if the demand disappears what happens to the suppliers?  They lower prices, or starve...

I'm the dumbest one of all of you for waisting my breath on this thread.