Single Post Display - MarketTicker Forums


	Detailed market commentary at The Market Ticker and Ticker Classics (The Year 2011 In Review) Donations accepted; we offer GOLD ACCESS for enhanced privileges. T-Shirts, caps, coffee mugs? Click here. BlogTalkRadio - Mondays at 3:30 Central - Yes, TickerGuy has a radio show (kinda) RSS available

MarketTicker Forums Single Post Display (Show in context)

User: Not logged on

User Info

Pillars of deflationists' arguments disputed; entered at 2007-12-02 02:53:56

Agi
Posts: 194
Registered: 2007-10-21

Pikachu wrote,

Quote:

one fundamental assumption is whether foreign economies are worse off. Inflationists contend that the USD will tank totally as the US economy tanks as holders of USD initiate a sell off due to lack of trust in the US economy. Deflationists content that while the US economy is bad, the rest of the world is worst, and there will actually be an increase in demand for USD as a flight of safety to USD occurs.

Ajas wrote,

Quote:

Sure dollar will devalue against foreign currencies in the near term, but those economies will soon burn harshly. Can you link the goldbug articles that include collapse of foreign economies in general? I've read (most of) the gold article quotes in this thread, but I feel like what I've read relies on relatively stable foreign economies?

Donja wrote,

Quote:

Now . . . the dollar will very likely strengthen with expanding economic recession on a global scale . . . flight to safe haven: U.S. But this will only be temporary as the flight of capital from the U.S. (now underway) begins anew and speeds up.

Genesis wrote,

Quote:

The assumption that "the rest of the world will fare better" is IMHO fallacious. We are likely to fare better, not that this is saying much. We are also likely to be the first one out the other side of this mess.

I've been wanting to call Peter Schiff's show again with a "devil's advocate" question, but have had trouble trying to determine the best one to ask. The quoted comments above might form the basis of a query. If his decoupling thesis is incorrect, his current strategy (get rid of dollars and hold select dividend paying foreign stocks, precious metals, and foreign currencies) would be suboptimal. So my question would be something like,

Quote:

What makes you so confident that the rest of the world will fare any better than the US as our recession deepens? Yes we have a $55 billion per month balance of trade deficit, but the US has tremendous resources that will pull us through faster than the rest of the world.

If any of you can think of a better, more detailed question or a different way to phrase it, please comment. (I intentionally left out the comments about our powerful US military, as I don't think I could keep a straight face due to the difficulty we've had subduing two 3rd rate countries (Afghanistan, Iraq). Sure we could start nuking other countries, but we're not the only nuclear power, and once nukes start flying I think the consequences would be too difficult to analyze).

Nothing would stop one of the 'deflationists' from calling his show, and that might be better anyway as you probably could come up with a better follow-up question. The reason I like the idea of calling his show is that he has similar positions to Marc Faber, Jim Rogers, Jim Puplava, and others, but is more accessible.

2007-12-02 02:53:56