50% Collapse of the US Dollar Equals Boom or Bust

eCoinquest

Here goes....

So Mr. President is spending like there is no tomorrow. A trillion $ here and a trillion $ there.
My question is this: Once the US has been demoralized, the economy brought down a few notches, and China is the "World Policeman". What if Mr. President successfully destroys 50%-75% of the US dollar against other currencies. Would this not make it 50%-75% cheaper for cash rich US companies to export more to other countries that suddenly see their currency rising?
I assume the effect here would be an extreme division of wealth, there being a distinct ultra-wealthy class and a much larger poor lower class. This being caused by the decreased value in the US dollar. Of course those companies would possibly be hurt by the declining value of the USD. It is possible that very large US companies could invest a substantial amount out of the USD in, for example, the Euro or the Yuan thus protecting them from any substantial declines. Is it possible that this could trigger a more powerful US economy based more on exporting than importing?

I am sure there is much more to this but this is an interesting topic.
Opinions?

halfhunter

<< <i>Here goes....

So Mr. President is spending like there is no tomorrow. A trillion $ here and a trillion $ there.
My question is this: Once the US has been demoralized, the economy brought down a few notches, and China is the "World Policeman". What if Mr. President successfully destroys 50%-75% of the US dollar against other currencies. Would this not make it 50%-75% cheaper for cash rich US companies to export more to other countries that suddenly see their currency rising?
I assume the effect here would be an extreme division of wealth, there being a distinct ultra-wealthy class and a much larger poor lower class. This being caused by the decreased value in the US dollar. Of course those companies would possibly be hurt by the declining value of the USD. It is possible that very large US companies could invest a substantial amount out of the USD in, for example, the Euro or the Yuan thus protecting them from any substantial declines. Is it possible that this could trigger a more powerful US economy based more on exporting than importing?

I am sure there is much more to this but this is an interesting topic.
Opinions? >>



I see the theory here except for one thing. What do we have have to export? Most of the US manufacturing base has been moved to other countries. JMO

Regards,

HH

rgCoinGuy

China the World Policeman?




They have been trying to poison us and our pets every way possible, not to mention producing most of the counterfeit products in the world.

dbcoin

Export?

food: grains, corn, wheat, soy beans, meat

Airplanes: Boeing. We are #1 in this area

Telecom equipment: Lucent switches, Motorola

Defense products: too many to name. I think we are #1 in this area

Oil drilling equipment

John Deere products: see food above

Catepillar equipment for mining and agriculture

chemicals: Dow, FMC, many others

software: Microsoft, Oracle, symantec

videos and entertainment: We have to be #1 in this area.

financial products: CDO's, derivatives...

I am sure there is more.

oreville

<< <i>China the World Policeman? >>



Well, maybe not the world's policeman but China wants to be the world's #1 superpower, militarily and economy wise.

tincup

There has been much talk about forming a new world reserve currency, which may still include the US dollar but will most likely comprise a basket of several other currencies and possibly even a tie to gold and silver.

This is being talked about much more frequently, and Geitner even let it slip at one time that he is considering it.

If this happens, and the US dollar is no longer the world reserve currency, I suspect that will turn the US loose to hyperinflate. Why would they want to do that? Simple.... that would be one way to wipe out the overhanging debts (derivatives, etc) by making them virtually worthless. Unfortunately, it will wipe out individuals that have put their money in fixed accounts also. But since when do the higher ups in this government care about the average normal investor?? That's a small price to pay to be able to get rid of the toxic debt (in their minds). Everything is geared to save the big boys and make them whole again and give them more power.

And yes, if the above does come to be, you can absolutely bet that the big banks will be given sufficient notice so they can 'shift' assets to euros or yuans or whatever the new currency basket will be holding, so they can protect themselves.

As for the rest of us, best to keep watching very carefully. Don't wake up some morning and find out that your fixed account is suddenly becoming worthless.

Buy physical gold and silver and hold. Might be a good time to start getting back into a few stocks, not that I expect them to start gaining much, but at least you will have some ownership of something that may eventually pay off.

coynclecter

Our dollar has been kept too high for too long. The "strong dollar Policy" is a statement about deliberate manipulation to maintain a strong value. This might be good to the Wall Street and other elite who can create dollars for thier buddies but its not good for the manufacturers who cant compete in the global economy. Let the dollar fall to 50 and we will suddenly have a much larger manufacturing and export economy.

However the world depends on our imports so expect them to devalue as fast as we do.

Bear

If everyone devalues their currency 50%, what does that mean.

Status quo ?, deflation ? What?

ProofCollection

The assumption you have to make is a dep. of 50% against most other countries.

An interesting scenario... import prices would skyrocket, but suddenly off-shored production would be less feasible and might brought back, and other countries would start to offshore to the US... That is, assuming BHO doesn't make our business climate even more hostile with more regulations and taxes (fat chance).

DoubleEagle59

<< <i>

<< <i>China the World Policeman? >>



Well, maybe not the world's policeman but China wants to be the world's #1 superpower, militarily and economy wise. >>



I agree.

There's nothing that would make China happier than to bring down the US.

Some say the next World War will be a 'Financial' World War only.

If this happens, it looks like China would destroy the US (in currency).

jmski52

If the price of everything goes up and tax rates stay the same or increase, guess who wins and who loses?

It's strictly a power grab. Can you say "Venezuela"?

ProofRainbowRoosevelt

<< <i>Some say the next World War will be a 'Financial' World War only. >>



It's happening right now, and has been for a few years.

eCoinquest

Talking to a WW2 vet, he was reminiscing about coming home and the amazing economic might of the US in the post WW2 era. The shipping yards were packed as were the factories producing cars, machines, household appliances such as televisions.
His memories of going to college via the G.I. Bill and the guys there at the time. They were all veterans of the war. They new 2-5 years of their growing up time had been lost fighting in the war and were not going to lose another minute. Everyone new what they wanted to do and were willing to work hard to achieve it.

It is these kind of people that we need more of. People who are willing to sacrifice and understand hard work. It is these people that propelled the US of A into one of the largest boom times in the history of the world.