What would happen to coin values if.....
bidask
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35% drop in the US dollar predicted
I manage money. I earn money. I save money .
I give away money. I collect money.
I don’t love money . I do love the Lord God.
I give away money. I collect money.
I don’t love money . I do love the Lord God.
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Bitcoin could go up
Coin value charts would approximately mirror the 1976 to 1982 era???
OK, I'll bite.
US debt is terrible but is no worse than most of the other countries and better than some. EU is still being drug down by Greece's public sector spending and early retirement age. Is a mystery why other members of the EU have not pushed to standardize on retirement. UK is doing the right thing to exit now. UK currency may turn out the be the winner among EU and the dollar. But the USD is still king vs EU and any third world country. The EU shows no desire to manage their deficits.
To get the USD to self destruct, interest rates would have to be pushed actually negative vs the current real negative rates. FED had said that they will not pursue stated negative interest rates. (For capitalism to exist there has to be a positive cost of capital. Just saying.)
China is the wild card. They can manipulate currency easily. Their big play would be to stop buying US Debt. But that would make interest rates go up not down. And the USD would strengthen accordingly.
In summary, a big drop in USD compared to other currencies will not happen.
Now, replying to a different question: Would I see USD purchasing power decrease and inflation become a big problem? Yes. And precious metals would benefit.
Regarding collectibles, I have said in other posts that the life span of collectors and lack of fresh blood in the hobby will put a limit on coin prices.
But hey, pull up a chair and change my mind.
Link to 1950 - 1964 Proof Registry Set
1938 - 1964 Proof Jeffersons w/ Varieties
Persistent deflation in consumer products (brought on by globalization and technology) has led the Fed to artificially depress interest rates to stave off more widespread deflation, thereby fueling debt and asset bubbles. A severe decline in the dollar would set off a reversal of all of those trends, i.e., higher consumer price inflation, higher interest rates, and bursting debt and asset bubbles. In that environment, I don't see any opportunities in holding onto anything, although I do think that rare coins and bullion will be a relatively safe haven. Of course, some coins will prove far safer than others.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
That ‘article’ is two sentences long. I wouldn’t be too concerned about it’s prediction.
The dollar may indeed implode one day. But I’ve heard that it was right around the corner my entire life.
He's been predicting this for a while, using many more words than you see in the article. And he's no dummy.
Read more here:
https://finance.yahoo.com/news/crash-dollar-coming-210024166.html
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
The inability to reign in the debt is really interesting.
Simple: inflation.
Lower dollar value equal higher prices.
Keep in mind that that's a 35% drop from it's current value. It's current value is less than 5% of it 1913 (year Federal Reserve took over money) value.
Capital investment depends on confidence. - Martin Armstrong
Gold and silver skyrocket.
A change in exchange rates isn't the same thing as a change in purchasing power, except with respect to imports.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Andy, I appreciate your comments around the massive deflationary move caused by tech (and tech enabled “free” products like FB and this message board).
Inflation hawks easily underestimate just how much cheaper tech has made things.
Can that continue? I think yes, especially if healthcare can get the same treatment that retail and communications have received.
Agreed, and that will serve to moderate consumer inflation even as the cost of imports soars.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
If you think gold is expensive now, you haven't seen anything yet.... If the above scenario does play out, gold will double.... I see PM's being the major safe haven for a while.... Cheers, RickO
I've heard it said that the dollar is the best looking horse at the glue factory.
My Saint Set
And numismatic usually follows along...
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If the 35% drop in USD did happen relative to the other currencies, then a downward spiral would start. In the worst case, it would force USA into asset sales. Has happened to countries before. Early 1800's France was broke, bankrupt, and kaput from waging the Napoleonic Wars. Banks were funding both sides of the conflicts but decided it was throwing good money after bad. So the world banks stopped lending to France and called the notes. And the USA refused to provide loans to France. France was forced into asset sales.
What was the asset? Louisiana Territory - that the USA picked up for $15M in gold.
If the USD crashed, first to go will be any gold left in reserves. Then better start considering a sales price for Alaska to Russia and Hawaii to Japan. And would only be necessary because Congress' spending is out of control.
Link to 1950 - 1964 Proof Registry Set
1938 - 1964 Proof Jeffersons w/ Varieties
Alaska won't be for sale - the amount of US military assets and training areas up here would prevent that.
Huh? Things have changed over the last 200 years. Many countries have defaulted on debt since, say, we stopped exchanging gold for dollars at a fixed rate. None, as far as I know, were forced to surrender gold or territory.
We actually paid with US Gov bonds with a payment schedule over multiple years. France, needing the money right away, sold those bonds at a discount. I don't recall to whom. A British bank maybe??
We borrowed the money.
Actually, the government has been "reigning in the debt" for many decades now. What they haven't done is rein in the debt.
was trying to answer directly the question - 35% drop in USD... that is catastrophic... is not like the same percentage drop in stock market.. currency is much more leveraged.... things we would think are unimaginable now would be the 'new normal'..
Might not be able to borrow because interest rates would be prohibitive... most likely would print 'money' similar to Germany being forced to pay reparations after WWI... that resulted in hyperinflation... Germany was limited in continuing with the printing because they ran out of printing press time and paper at one point. Our good government is thinking ahead. Learn from Germany and convert money to digital and won't be limited how much you can inflate.
which would make gold increase again.... all scenarios pointing to gold going up for that case of 35% devaluation
Link to 1950 - 1964 Proof Registry Set
1938 - 1964 Proof Jeffersons w/ Varieties
send me your US dollars now, for which I will pay you 70 cents on the dollar, allowing you to be 5% ahead of the rest of us poor souls
It's not all that unusual for a country to have its currency drop 35% and not suffer severe consequences. In fact, some countries with big trade surpluses have probably benefited from declines of similar magnitude. For some historical perspective, here's a chart for the US Dollar.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.