Head and Shoulders on Dollar Broken?
From my post Dollar at Inflection Point two weeks ago:
And now from Thanksgiving day:
The dollar is trying to break down. Why? Here’s a quote from the Bloomberg article Dollar Declines to 19-Month Low:
People’s Bank of China Vice-Governor Wu Xiaoling said East Asia needs to reduce its reliance on dollar inflows because of the risk of a further slump in the currency. China’s foreign- exchange reserves exceed $1 trillion, the world’s largest.
Wu’s comments were released today in an article circulated during a press conference in Beijing.
“China holds most of its reserves in the dollar and these comments may lead to speculation they will sell,” said Tohru Sasaki, a strategist in Tokyo at JPMorgan Chase & Co…
Ya’ll know my site is filled with currency rants. I believe the effect of currency values on our economy and the severity of the Real Estate Crisis are the two most understated and under-reported phenomena relating to our finanancial (and even political) futures today.
As the dollar fails thru the top of that right shoulder (on the H&S) and threatens to spiral to multi-year lows, here are a few of my recent mumblings on the subject:
The most recent was the above post from only two weeks ago.
Back on October 29 I wrote this post as the yuan hit another new high.
And then from September here is the article where I tried to show, at least to my understanding, how China and Japan have been manipulating their (and in turn, our) currencies for some years now.
john w said,
November 25, 2006 @ 3:22 pm
While the only real solution to the dollar crisis is a return to some hard metal standard or humongous interest rates any real solution to the dollar crisis causes the housing crisis to get worser and worser.
Wait - wait - don’t tell me - I know - the Government can decide for the best of the economy through the right of eminent domain (as decided by the Supremes ) that it can burn down every third house in the country in the name of interest rate and dollar stability.
This will cause an immediate housing shortage and the global economy will be saved. Sigh - my hewo….
Short of one of those two things happening - we’re screwed.
Now if at least one half of the morons in this country still believe that there are WMD in Iraq how in the hell are you going to get them to buy in on the dollar and housing crisis stories? So maybe the reason why it isn’t reported more is that the assholes in the media don’t know how to report it in as simple a way as “Deal? or No Deal?” and make sure that the very above average American citizen - A. pays attention, and 2., get’s the message.
Not happening. Don’t waste time ranting.
Film at 11.
Lloyd Philip said,
November 25, 2006 @ 6:05 pm
John,
Too much sense for the average person in this country. Just watch our local news, they spend more time on a daily basis on how a cat or duck is stuck in a tree and how the fire company came to the rescue. World news or world education, now that’s a tall order. Most of us have no idea what’s happening down the street, let alone the importance of ignoring fictional WMDs. I still remember seeing Colin Powell selling his principles out and trying to convince the world that Iraqis drive around in mobile trucks building building WMDs. I always tell my friends, if there’s a country that builds their WMDs through such Mickey Mouse operations, then let them do so as they will suffer the consequences before lift off. Anyway, it’s thanksgiving and we should be thankful that we may not see a dumber administration of some time.
LP
john w said,
November 25, 2006 @ 11:56 pm
Amen, brother, amen - have a nice whatever you happen to call the next 30 days or so.
Inflation, Deflation, Real Estate, The Dollar and Their Effect On Equities • dummyspots.com said,
March 16, 2007 @ 6:57 am
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