No one can definitively say you don't make a valid point, but there's never been a currency holding the position that OUR dollar does; It has been the exception.





WE forgave the debt of Allies & Enemies, in order to become the World's Modern Day 'Gold-Standard'.
WE are not Wiemar, Zimbabwe or, currently, Venezuela, their currencies set the price of nothing, so their 'bold' measures caused/causing Hyper-Inflation for their citizenry.
Deflation has been and should be OUR Concern, so once interest rates naturally go up (Strong Dollar), naturally, prices will go down; Losing that 'Wealth-Effect'.





That's some real power & there's nothing fake about it...WE are still the best bet, until WE lose the next World War, at least.





In my opinion, but I have to warn you I'm a "Genius'





ETA Tomac's argument: The World Is Screaming For A New Financial System





I still think once interest rates start to raise all will be forgotten
 

I'm more inclined to think that once interest rates start to rise, which they must, that the US dollar is going to be in a world of hurt. This is primarily because as interest rates rise, more and more money has to be spent or printed into existence to pay the interest on the astronomical debt we already have. Rising rates, while helpful to savers, makes borrowing for growth/expansion/etc. much more expensive. At the federal level, once we get to a point where just paying the interest on the debt exceeds the revenues coming in from taxes, we instantly become Zimbabwe and the world (with the US leading, of course) goes into a catastrophic depression. In reality, once Treasuries lose their luster as a "gold standard" for money good, that is the day the dollar dies.

BTW, the British pound was once considered the world's reserve currency owing to the influence of the vast British Empire. Empires eventually collapse and with it their currency's status in the world. So will it be with the dollar. And Ostupid is accelerating our country's loss of stature in the world at an alarming rate.

Why do interest rates NEED to rise? The wealthy oligarchs make their money through insider trading on Wall Street. And as long as they can speculate on cheap money then they will use their influence to keep rates down.

Military strength didn't save the Soviet Union's economy or any other fiat currency throughout history.
Tomac

History is littered w/great empires/cultures whose currency was the most valued in the world (at that time). History's graveyard is littered w/those same empires/cultures/currencies...

Bottom line is this: Nothing but hubris would make anyone believe that the US is immune to the historical/financial forces that have destroyed hundreds (if not thousands) of fiat currencies over the centuries. Our ever-growing national debt is mathematically impossible to repay, *ever*. Any significant rise in interest rates would consume *all* federal revenue just in interest payments alone.
Tomac

 






 

Yeah, but none of them ever lasted 200 years.......

The USD was "money" (instead of "currency", look up the difference) until, what, 1971 when it became a fiat currency? Historically, the average life expectancy of a fiat currency is appx 40yrs. Do the math...
Tomac

If WE were the only Country 'printing money' I would concede, but the truth is all 'Great' Nations are doing some sort of their own QE/Stimulus.



It seems America is only discussed because OUR economy is largest; There's no better consumer than those in America.



Again, I can't say you're wrong, but WE do have an open/accountable Government that, eventually, tells the truth.



Communist China has the same? You're a Nation of Free People or your Communist, their Hybrid Government will fail because they have a Billion+ problems of their own.



Russia? A tyrant will never rule the world.



Japan puts OUR Printing Presses to shame & look at how tiny they are.



Germany, France, Italy, the UK are part of Failing Union that could cause a Currency to Collapse if just one Nation leaves.
I agree OUR Debt is ridiculously scary, but WE are not only trying to 'save' ourselves, being the Super-Power that WE are.



A Protectionist Position will cause a firestorm for sure, and WE might be heading there; WE still represent the Hope of Individual Freedom.



People can hate the Politics, but not OUR Liberties.
The Biggest difference between All Previous 'Empires', was the lack of a Constitution, creating a Great Republic like this one.



WE have a document that has a Bankruptcy clause for a reason; They learned from History.
Currently, WE have become Spoiled & Lazy, to some degree, from all this 'Cheap Money',  and OUR Representatives have followed this trend because it's easy & fun; It's hard doing the 'Right things'.



This will correct itself since OUR Nation's culture has always been the 'Strong Survive', WE will appreciate the pain, but be better off, once these Political Pimps' policies fail, again.



History has taught that a Tyrant will always implode, but a Free Society can rule the world.



I may be naive, but there's no better option than America...where the Winners always Win!!!



I blame the F'in weak-minded Political Pimps & MSM for causing all of this doubt



Focus on the Positives, keep working hard, stay motivated people & don't follow that easy path...Life is Good





eta

Sorry for being so long winded, I didn't realize how much I just wrote





 

 

Basically, OUR Dollar replaced Gold, so would any Nation throw away Gold?

The agreement was a Strong Dollar, and that's what will correct soon, hopefully



 

It is protectionist.

Remember:

Eventually, the Oligarchs will be left fighting the Serfs


Interest Rates will go up, since it will be the only way to manage this Debt, so the Theory goes.


WE should have preferred controlled Bankruptcies.





What's a better option: $1000 buying $500 worth of Good & Services or $750 buying $750 worth.




eta

Fourth Turning: The People Vs. Big Brother





 

For starters, A Protectionist stance would mean none of OUR QE would have gone to other nations & Imports would be taxed at a higher rate; I won't go into the 'Conflict' aspect, Putin seems to be testing.

OUR 'Oligarchs' are failing and their corruption is being exposed; when the cycle shifts there will be plenty of 'tell-all' books that expose these Political Pimps & hearings like never before.

WE the People are demanding it, WE just have to Participate to be heard.



 

On the week of March 12, foreigners sold $104.5 billion in  U. S. Treasuries.  The exit door is being used more.  http://www.zerohedge.com/news/2014-03-14/it-begins-past-week-foreigners-sell-record-amount-over-100-billion-treasurys-held-fe

Good article.

I weep for my, and your, children.

Some form of accountability will be realized by Hearings, by Elections, or by meeting their Maker...In the end, 'What difference does it make', just get the Pimps out of the way.

You/WE didn't become a success by waiting around for others to act, correct?

You probably learned some hard lessons along the way & there's some too embarrassing you'd be willing to admit to



'Geniuses' aren't born everyday, you know...it's a process; In my experience at least





 

1) All major currencies are "racing to the bottom". We may be in First Class on the Titanic, but all that means is that we're the last to sink.
2) We have "an open/accountable Government that eventually tells the truth"??? Where have you been the past several decades? Where's the "open/accountable/truth" w/regards to Benghazi, Fast and Furious, ignoring Contract Law in the GM settlement, NSA monitoring of non-suspect US citizens, the IRS investigating/harassing political opponents, etc? I see little openness, less truth and no accountability (seen any indictments/convictions lately?) and this goes for both sides of the aisle. Most recent: http://www.washingtontimes.com/news/2014/mar/13/fbi-blocked-in-corruption-probe-involving-sens-rei/
3) Words on paper have no force of their own and are not immune to cold, hard math. It takes people both in and out of govt to believe and follow them. Someone once wrote "The Constitution was written for a moral and religious people" and, sadly, we have less and less of that with each passing year. What happens to the common man when a govt declares bankruptcy?
4) Our culture *used* to be one of rugged self-reliance. Nowadays we have the entitlement mentality and a growing unemployable underclass increasingly dependent upon govt handouts. They will vote for whomever promises the most freebies and most certainly will *not* vote for anyone promising to cut or eliminate those handouts. There *will* be a correction eventually, but historically it will *not* be pleasant and the outcome may very well be a totalitarian govt that will stop at nothing to maintain power & control. Look at what the financial collapse of the Weimar Republic led to...

Feel free to "focus on the positives" but it's moot to discuss what's for dinner or how to rearrange the deck chairs after the Titanic has hit the iceberg. We are past the mathematical tipping point, it's no longer a matter of "if", it's now a matter of "when". Cognitive dissonance and normalcy bias are the standard of the day.
Tomac

No nation throws away gold. However, they are replacing the failing USD w/physical gold (China, for example, is buying gold hand over fist, not USD's). Btw, read up on how the US broke the Bretton Woods agreement.
Tomac

WE are on the same page on most of what you discuss, a few hundred pages ago...lol I conceded the 'Bad' has already happened, WE need to focus on solutions, instead of stating what's already been realized.



WE are still the best option out there.
Personally what's Crazy are Nations thinking they can Force Gold into being Worth the Hundreds of Trillions currently Owed.



Some sort of Default will occur for that change.



It would be easier to strengthen the Dollar, than to convince markets to over pay & purchase Gold.







If the Dollar was forced to lose its current reserve status, the Shock-wave would be the equivalent of a Global EMP blast completely leaving the World in a State of Anarchy overnight.


Wherever it's tried, it's failed & those a by 'insignificant' Governments.
OUR Dollar has become the World's Nuclear Weapon, per se., if one pulls the trigger, everyone will react accordingly.



That's an interesting point, WE never associate OUR Dollar with M.A.D., Mutually Assured Destruction?



I guess the the trick will be to keep everyone from believing WE are holding them Hostage



So much for focusing on the positives



Whatever...Life will always be Good, until I can no longer be an Internet 'Genius'





 
 
 

It's impossible for Gold to replace OUR Dollar.


Communist China has manipulated markets more than any Nation, including US.


Who in there right mind would voluntarily hand China that opportunity peacefully?


Their Oligarchs are preparing for their own demise or exit?


The Illusion they keep repeating is some proxy war against the dollar.


Meanwhile, all this new found wealth is leaving China & ending up in America, plus other 'Free' Economies.


Why can't they motivate their own Billion+ Citizenry?





Communism Fails ever time.


China's 'players' have used Capitalism to leverage against their citizens, and make long term plans for themselves, excluding the people they are supposed to 'Care for'.
 

...but you kept going, and that's a free lesson to everyone.

The rules change, not the game...WE all have a Sob story, Get over it & Get back to work





 

Why is it impossible for something that's been a known and trusted medium of exchange for literally thousands of years to replace something that has no intrinsic value?
Take a look at a $20 bill. How much is it worth? 20$? *Why* is it worth $20? It's only worth $20 because you *believe* it's worth $20 as there's nothing backing it (like there once was when you could exchange your dollars for gold or silver at any bank). Once you stop believing that it becomes a worthless piece of paper (linen, actually).
Yes, China has manipulated markets, no argument there, but it has nothing to do with the guaranteed eventual failure of the USD as a fiat currency.
Politicians have repeatedly made irrational decisions w/regards to national security, fiscal responsibility and legal/moral judgement all in the name of personal or political gain and will continue to do so.
What "new-found wealth" specifically is leaving China for other countries?
It's a fact that despite China's own economic ills (and they are severe), China continues to purchase gold hand-over-fist and even encourages its own citizens to do the same. If gold is so worthless, why are they doing this?
It's a fact that Western banks have engaged in price manipulation in an attempt to keep the price of gold down and less attractive to those who might want something more secure than USD's. If gold is so worthless, why make the effort to do this?
Yes, communism always fails eventually, but again this has little to do with the continuing decline and eventual demise of the USD.
Examples: 100yrs ago, a 90% silver quarter would buy you a gallon of milk and a loaf of bread. Today, that same silver quarter will still buy you a gallon of milk and a loaf of bread due solely to the value of the quarter's silver content.
In 1964 minimum wage was $1.25/hr (or 5 silver quarters). If you were paid 5 silver quarters/hr today you'd be making appx $20/hr due to the silver content alone of those quarters.
But what will a standard quarter buy you nowadays? Why won't it buy as much as a silver quarter? Why has silver & gold retained its value over time while the USD has become increasingly worthless?
The answer is that the USD is a fiat currency and like all fiat currencies throughout history, it will eventually be worth *zero*. There are *no* exceptions.
This ends our Finance 101 lesson for the day.
Tomac

Hubris has been at the core of the downfall of many great powers. You haz it.

There has been much speculation about the fact that China has been importing so much gold in addition to that which is produced domestically. My personal pet theory is that they plan to stockpile a mountain of gold until such time as they can "convert" the Yuan to a gold-backed currency. China's GDP is large enough even with fake accounting that if their currency were to be gold backed, there would be a tsunami of dollar selling to buy Yuans. In fact, most of the countries in the world would dump the dollar in favor of a gold-backed currency. The main reason is that, in theory, a gold-backed currency has less leverage to be manipulated by a specific actor. Many countries, including some of our allies, aren't particularly pleased with the Fed de-valuing the dollar when they hold so many dollar-denominated assets (like Treasuries, for example).

While there are several countries stupidly trying to de-value their currency (the US being one of them), ultimately they will fail and the currency exchange rates will reflect market forces, not central planners deranged hallucinations. The same will happen to interest rates eventually. The world marketplace is much bigger than any central bank. When a large enough block of that market decides they've had enough, they will decimate whatever central bank stands in their way. Fortunately for us, there would be some cost to that, and the market players are as yet unwilling to pay that cost at present.

With our current Odumb$hit-in-Chief, our GDP will continue to shrink and other countries will likely continue to rise. His idiotic "transformation" will have been completed - changing America from a "colonial" Superpower to just another country. Economically, militarily, legal and morally, just about every aspect of life in America will have been seriously degraded by this A-hole, his breathtakingly brain-damaged minions, and the CommunistDimocrat party as a whole.

From a few posts above:

Russian Hyperinflation Deja Vu?

ETA





Threatens switch to other currencies over sanctions threat...
Soros Predicts Ukraine Could Ruin EU...








ETA part 2





Venezuela In Turmoil For Lack Of Flour, Milk And Diapers...




Inflation rate reaching 57%...





 

 
 

 
 

If you don't hold it, you don't own it.

Broward "boiler room" sold $2 million in fake precious metals; two arrested

Interesting...



http://thedailysmug.blogspot.com/2014/03/jpmorgan-bankruptcy-lawyer-killed-in.html

I don't believe the pie chart. Seen it many times. Just like the BS by Saez and Piketty on how the top .001% own 999999% of the milky way. It just keeps getting repeated.

The military spending numbers of China, Russia, France and other players are not as open as people would like to think.
They're bigger than that chart would have you believe. The chart is more BS from the hate America first crowd.

 

Hehehe, yes, here we go..... the fine print

for example:   http://www.rickety.us/2011/06/2010-defense-spending-by-country/


Notes

   Figures are in US $billions at 2010 prices and exchange rates.
   Percent GDP is for 2009.
   Percent GDP ranking is included because high expenditure countries are not necessarily spending at high percent of GDP.
   $159.3 billion of the U.S. budget is for “Overseas Contingency Operations,” to fight the wars in Afghanistan and Iraq.
   Figures for Chile and Saudi Arabia are for the adopted budget, rather than actual expenditure.
   Figures for Israel do not include spending on paramilitary forces.
   Figures for Japan do not include military pensions.
   Figures for the USA are for financial year (1 October to 30 September of stated year).
   Figures for China are estimates, including estimates for items not in the official defense budget.
   Figures for South Korea do not include spending on relocations and welfare of $974 million dollars.
   Figures for Italy include spending on civil defence, which typically amounts to 4.5% of the total.
   Figures for United Arab Emirates are uncertain and lacking in transparency. The only available source of data is from the IMF.

Sources

   SIPRI Military Expenditure Database 2011, http://milexdata.sipri.org.
   Dollars per capita were calculated using 2010 populations via Wolfram Alpha.
   U.S. military budget percentages from Wikipedia, accessed 4 June 2011.
   DoD photo by Chief Warrant Officer 2nd Class Clinton W. Runyon, U.S. Marine Corps.

SIPRI being the "Stockholm Peace Research Institute"   - No agenda there I'm sure!

And then we get on to Russia's numbers from them....  http://milexdata.sipri.org/

"For the sources and methods of the military expenditure figures for the USSR and Russia, see Cooper, J., 'The military expenditure of the USSR and the Russian Federation, 1987–97', SIPRI Yearbook 1998: Armaments, Disarmament and International Security (Oxford University Press: Oxford, 1998), appendix 6D, pp. 243–59. Up to and including the SIPRI Yearbook 2002, PPP rates were used for Russia for converting local currency figures to constant dollars."

Contributions of military expenditure data, estimates and advice are gratefully acknowledged from the SIPRI Military expenditure network.

All the numbers are bracketized and all the numbers in brackets are estimates. Go there and see for yourself.

--------------


I don''t know where you got your pie chart and I really don't care. I took rickety.us as an example because it's about the same as yours.
The numbers are always recycled and about the same. Guestimates from people whose first agenda is cutting the U.S. defense budget.

The U.S. has a fairly closed five year budgeting process for defense, but it's WIDE OPEN compared to other countries and their budgets.

Let's concentrate on cutting the real drivers of the debt.   That ain't war and defense spending.   http://www.usdebtclock.org

 

Social Security, healthcare and "income security" are about 70% of it. And yet year after year, when budget cuts are announced, defense takes the hit and the conversation never moves to Fannie and Freddie, HUD, Health and Human Services, EPA, Agriculture, Commerce, Transportation, Energy, Interior, and all the other depts. and agencies.  It's always cut defense and then the conversation gets conveniently forgotten about anything else. All that other crap that the federal gubment shouldn't even be into is somehow quietly pushed under the carpet. Why?

NASA took a big cut, but foodstamps and housing subsidies still go out.

70 percent of todays budget is transfer payments for gawd sakes. What the hell do we get for transfer payments? At least with defense, you get a product and not people on the dole doing nothing.

"We spend more then the next 10 countries combined" - I don't know that statement to be true. We spend a crapload, I know that, but statistics get played with too.

The military is spending massive amounts on "biofuels" for because the greenies want to make a statement and made it a mandate at $15 a gallon.
Is that a defense item or an energy item? Take a guess.

They're gonna cut hellfire missiles and tomahawks, but let Obamacare (a new entitlement) rip a hole in the budget and suck out $700 Billion out of Medicare, which was something people paid into for when they hit retirement. Now, not so much. These jerks steal whatever they can for more votes from the FSA. Most of our budget is centered around welfare for certain classes of voters.

There's more to the story than just the defense budget is HUGE and everything else, well..........

Holee shnikee. I wonder if she gets thin crust.

Two generations from now, the people of this country will look back either with jealously or with contempt.

Within the next ten years some of us will remember this article as we try to find that days food and shake with anger.  

At 30k calories per day she eats enough to feed a hard working laboring family of four for a week.

The Father Of High Speed Trading Speaks: "The Market We Created Is A Casino; A Complete Mess; A Rigged Game"

"...It is not so much anymore that the  public does not trust their
brokers. They do not trust the markets, the  exchanges, or the
regulators either. And why should they, given our  showing the past few
years? To the public the financial markets may  increasingly seem like a
casino, except that the casino is more  transparent and simpler to
understand..."

The Truth will lead to the next 'Crisis'...Reality





 
 


 

Just when you think you've heard it all...this thread delivers.

ML do you know what state? TX?

Everything is bigger in Texas

2014 crash will be worse than 1987's: Marc Faber

85% of pensions could fail in 30 years

 
 

How many times have we heard Faber say this?