http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/09/19/bcnsaudi119.xml Jim Rogers, the commodity king and former partner of George Soros, said the Federal Reserve was playing with fire by cutting rates so aggressively at a time when the dollar was already under pressure. The risk is that flight from US bonds could push up the long-term yields that form the base price of credit for most mortgages, the driving the property market into even deeper crisis. "If Ben Bernanke starts running those printing presses even faster than he's already doing, we are going to have a serious recession. The dollar's going to collapse, the bond market's going to collapse. There's going to be a lot of problems," he said. ------------------------------------------ Why is it that we never see this stuff published in US? Remember triple sell signal before Aug tank? It was in this UK paper. At that time, US pundits were predicting a melt up. We all know what happened with that prognostication.
The dollar weakness is really what the federal reserve wants. The current account deficit has already decreased since the dollar weakness. This is what is needed to re-balance. It will cause pain to the lower class, but that's what has to happen.
it's will not only cause pain to the "lower class," it will cause massive pain to anything and everyone who holds dollars. Think of paying $100 for a pint and fish and chips in London...won't be long now. BTW: if possible have your all accounts receivable, personal or otherwise, made in non-dollar currencies.
Now that makes sense! I could not figure out what Bernanke was doing as such an aggressive move would clearly collapse the dollar even more. And - voila! - it makes sense now. He came out with a statement last week that something had to be done to shore up the deficit and now he takes aim and fires... But one curious side effect of this is that other countries are following suit which will may pump up emerging and foreign markets even more leading to a new bubble. Thx RR
that would be pretty stupid. the US trade balance is in deficit mainly with China and that is not influenced by US monetary policy...RMB is fixed... to forsake inflation fighting credential for decreasing deficit with Canada is idiotic - and on top of that loonie is commodity currency, i.e. $ imports will actually rise because commodities will rise....