WSJ's new forum: betting on currency

Which currency would you bet on over the next  year.”  The options listed are the dollar, the Euro, the Yen and Pound… I had to take a shot at it… AS: Betting on the dollar, euro, yen or pound?  All of the above.  Over the next year, the rising debt of the dollar will continue to chip away at the value of commodity prices, wages, and national purchasing power.  China will do its best to keep the dollar stable, but the insatiable American consumer will invariably demand of governance someone who will feed and sustain their over-consumptive appetites, and adopt an economic strategy that will be much worse than the soft cushion Obama is trying maintain.  In the short-sightedness of this dilemma, powerful bank lobbies will begin to advise governmental policy that will allow for things like Aid, to perpetuate what has just happened with Greece, Haiti, and soon Chile: promote credit-default transactions, by hedging bets on weaker currencies and national disasters. This will be done in the name of national security. The Tea-Party movement will be take the lead on this strategy. We will wait to see  how the EU responds.  This dollar-led aggression, supported by– as reported by the NYTimes, for example– those looking to re-assert sovereign currency, is going to be challenging for the EU and the euro. This could be nothing but a hiccup, or it could be the beginning of some weird science-fiction economic warfare, where the only winners will be banks and the losers countries– thus betting on currencies for the short-term will be a win-win for betters and players alike, while betting on nations and people, may yield better returns in the long and painful future. The yen may strengthen momentarily if a unified Asian currency between Japan, China and S. Korea is further developed. To determine the strength of any Asian currency we will  have to watch closely and see how China will continue to support the U.S. economy. If  Wall St., in it’s pursuance of imposing itself upon other national currencies begins to move in a direction different from the Administration, China may lose confidence in its support of U.S. debt.  However, since China’s strength is currently dependent on our consumer purchasing power, it may continue to go along with supporting the dollar, no matter what kind of havoc is brought about. The British pound, parading itself as a national currency may continue to thrive as the larger currencies falter– but its strength will depend on how aggressive the British become in asserting its foreign policy.  Having sold off most of their colonial resources and assets to the U.S. to pay for Reconstruction after WWII, the British will have little choice but to continue to support American economic hegemony and that will help to determine its strength.  There are some signs that this hegemony may have begun to falter, but as long as we continue to treat terrorism as a national defense strategy, likely, the pound will be just fine. Now that we have entered into the arena where credit-default initiatives imposed on countries– rather than simply people have taken root, many more will be likely to see this as a the beginning of a new economic model, which in its havoc, signifies the last all-out effort to maintain what began as colonialism, institutionalized itself as imperialism, paraded around as free-market globalization, and will hopefully exhaust itself through indigestionism.  Soon, by consuming nothing, the imposing of this nation-crushing credit-default scheme will invariably create more divisiveness between banks and governments. What happens then?  Create a new currency? Re-invent our GNP? Shrug off currency defaults as nothing more than collateral damage? For the projections of the year, I’m betting on Goldman-Sachs. AS]]>

1 comment for “WSJ's new forum: betting on currency

  1. Helleojagasip
    June 17, 2010 at 5:11 pm

    Hi VEry nice posts i’sure i’sts nice

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