US Dollar at precipice.

Paper currencies, especially of the West, have been in a race to the bottom. With the ascencion of the Obama regime, the stage is set for the destruction of America's economy and the demise of the US Dollar.

The top graph shows the loss of value of selected paper currencies against gold. The loss has been steady for ten years. The currencies have lost a very substantial amoung of their value.

The second graph shows the the loss of value of the US Dollar against other currencies. The value of the dollar is plotted against an index, derived from comparison to other currencies. The general rule is that if a financial instrument buts up or down against a line ( be it either resistance on the way up, or support on the way down), it will go through that line on the third try. For the US Dollar, the magic number is 77.

The fall in the US Dollar is not accidental and not even due to economics. It is the deliberate policy of the Federal Reserve and the Obama regime. The use of the 'mark to market' accounting is aimed at bankrupting our financial institution. This reduces the value of America. A second way of doing this is to reduce the value of the US Dollar through inflation.

Beginning this week, BS Bernanke of the FED declared that the FED wants more inflation and will add to the outstanding currency. This has dropped the value of the dollar and increased the value of gold almost immediately (see next two graphs).

The last graph shows the technical expectation re the US Dollar. The head and shoulder pattern predicts the US Dollar to fall to 72 (in other words break through the 77 level) shortly. Indeed, the current value is at 76.5.

Analysts now predict the value of gold to rise now to 1,500/oz and both that and the value of the dollar are temporary figures. As nation after nation dumps their dollar reserves, the US Dollar will fall and there is no support in sight. Gold prices, on the other hand, are forecast to rise. Today, gold has reached $1,382/oz gold, but gold and silver mining stocks have not confirmed this rise.

The markets are waiting for yet another speech from Helicopter Ben.