Tuesday, October 8, 2013

Will the US Dollar be destroyed?

It is difficult to be a Stock Market Pundit nowadays. I do not consider myself such, but I am talking about Larry. The poor sap thinks that commodities and stocks are traded freely and that there is no manipulation of the Markets. That's why he keeps missing with his predictions. Like the one about the US Dollar.

According to Larry, the US Dollar will skyrocket as the Euro craters. Except that the Euro is not cratering, thanks to the efforts of the ECB to prop it up. And neither is the US Dollar skyrocketing. So, do I think that the FED is doing a good job holding the Dollar steady? Definitely NOT. What the FED is doing is manipulating the price of gold and the value of the Dollar. It is objectionable because the very act of manipulation puts the Dollar at risk.

And here comes the story of the Chinese warning us about our finances. They hold $1.3T in Treasuries and if they dump them...But, the Market does not worry. After all the POTUS has told us that if the Republicans fund ObamaCare and raise the debt limit then he will negotiate. It isn't clear just what they will negotiate.

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