Argentina on the cusp of hyperinflation

[Hache]

Because of Argentina's economic history, where the dollar was a true safe haven, the Argentines have an unfounded confidence in the current safety of the dollar

That's me exactly. Thanks for the heads-up.

 

[John.St]

The Republicans have already offered a plan that calls for dramatic cuts in spending and even deeper cuts in taxes for the wealthiest Americans. The subious rationale for the latter is that tax cuts stimulate the economy and generate more revenue,not less.

I somehow doubt a billionaire will use her or his tax savings to buy more potatoes, meat, clothes, another car, etc.

A comparatively poorer family, on the contrary, will spend some 80 or 90 percent of a tax cut on consumption.

 

[dr__dawggy]

I somehow doubt a billionaire will use her or his tax savings to buy more potatoes, meat, clothes, another car, etc.

A comparatively poorer family, on the contrary, will spend some 80 or 90 percent of a tax cut on consumption.

As I said in my post, the rationale offered by Republicans is "subious" (oops, should have read "dubious").

 

[barnaby33]

The future of the dollar, in my opinion is the same as for all fiat currencies. What is different this time are the dynamics of international monetary policies. In the aftermath of the first part of this crisis everyone is engaging in, "print your way to prosperity," economics. Not just the US, but pretty much everyone. Why anyone thinks that the Euro or the Yen are in better positions as currencies I don't understand.

America's debt to GDP is eventually going to crush it and I doubt Congress will do much more than tinker at the Margins. Extend and pretend can only work if real growth is possible. So assuming its not (which I do) and by extension assuming it won't (which E&P can't with out growth) we are left with either the quick or slow destruction of the US economy based on ever increasing debt.

How does this lead me to assume that the dollar will be the last man standing? Two reasons. One we still have a very large military, which is a secondary but necessary component of a reserve currency. Second our trade partners are in far worse shape with the exception of China and from my admittedly America-centric point of view China isn't doing so hot either. Thats however a discussion that is more subtle. Japan has a far worse debt to GDP ration than we do, an older population and is grossly export dependant. Europe has some countries that are in far worse shape, some that are in far better shape and a single monetary unit to cover them all. No central fiscal enforcement and no military to back up its debt/asset claims. There are lots of other reasons but those two should be sufficient to back up my assertion that while the dollar is dying, its still the last man standing.

 

[marksoc]

and no military to back up its debt/asset claims

Large Armed Forces cannot make me buy your products, only good products can. Witness the Soviet Union, it fell because of their defense spending. It all depends on China. What China decides to do is what will decide the future of the USA. Fiat currencies (or as we call them: currencies), will continue being the exchange method by which we buy hours of labour from each other. Gold and others are not inherently valuable (outside their value of use) more than fiat currencies are. We use fiat currencies because sometimes we can play with them and make things less worse, at least for a while, and sometimes it works. If there is modern civilization, there are fiat currencies, until the master currency arrives (facebook credits? hehe).

 

[redrum]

Fiat currencies (or as we call them: currencies), will continue being the exchange method by which we buy hours of labour from each other. Gold and others are not inherently valuable (outside their value of use) more than fiat currencies are. We use fiat currencies because sometimes we can play with them and make things less worse, at least for a while, and sometimes it works. If there is modern civilization, there are fiat currencies, until the master currency arrives (facebook credits? hehe).

yes and no. gold and silver DO have intrinsic value, perhaps silver more than gold. gold is more a monetary metal and doesn't get consumed much. silver on the other hand is consumed and destroyed.

the thinking that a modern society needs to use a fiat currency is false, conditioned thinking by those who naturally benefit from the control over currency and credit. a paper currency can certainly be used but it needs to be backed by something, be it gold, silver or coke bottles.

as long as a currency is not backed by something it will be printed into oblivion over time as governments will never be able resist printing. this has happened time and time again throughout history to all civilizations past and present.

conclusion? you cannot print gold and silver. therefore, get as much of the yellow metal as you can because we are nowhere near the heights that gold will reach - silver too.

 

[Napoleon]

At the end of the day, it all comes down to Military might.

There is a computer game called "Civilization". I've never played it, but it's addictive. You build societies and you get points for arts, culture, science... but I've been told that it all goes back to military might. You could say that that's because it was developed by Americans (don't know if that's true or not), but I think really it just follows the course of history.

Either way, I'm betting the future on Bolivia's currency. I think that that will be the wave of the future.

 

[clooz]

therefore, get as much of the yellow metal as you can because we are nowhere near the heights that gold will reach - silver too.

as you buy and sell gold be aware that for "US persons" it is taxed as a collectible, and there are strange rules and extraordinary high penalties in the fine print. as a hedge against hyperinflation if it works the tax on the hypergain will be in effect a confiscation of the gains at much higher rates than other assets, again no surprise, so make sure you read the rapidly changeable tax code before moving into and out of collectibles so that you are tax efficient

 

[dr__dawggy]

Either way, I'm betting the future on Bolivia's currency. I think that that will be the wave of the future.

hehehhe

 

[clooz]

A whole lot-a printing going on. I think we should look at investing in the businesses who design, and print currencies and mint coins. And those little note-counting machines are gonna get worn out, so who makes those?