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Why is the US dollar so high?
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Krieg Offline
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Posts: 73
Joined: Dec 2015
Post: #36
RE: Why is the US dollar so high?
1)US interest levels are high thus causing capital migration.Banks and nations are buying US bonds.Russia and China are the biggest holders of US bonds and Russia just bought more.

2)Quantitative easing in Eurozone. In order to combat the deflationary signs the Brussels printed more Euros. This has been in all major papers since last summer- read the news (instead or writing vague and ridiculous statements of "massive debt"and "weak PIGS countries, which is actually not exactly true, for example in case of Spain and Italy)

3)With regards to China- the Chinese renminbi is not a reserve currency. Besides the Chinese economy is contracting and China printing more money too.

4)British pound is doing well, but low interest rates don't attract much capital. They were planning to raise the interest but will postpone it for now, as collapsing China is lurking behind the corner.

4)With regards to Russia-chickens are coming home to roost. Russia is a classic example of a corrupt banana republic, instead it's exporting oil in place of bananas.Think of it as Northern Nigeria.68% of Russian export is petroleum and petroleum gases. During the 15 years of incredibly high oil prices Putin channeled this money into his own pockets and pockets of his jewish elite who were buying English football clubs,foreign companies and most expensive yachts in the world,instead of investing into infrastructural projects and diversification of economy (e.g. there have been less roads built in 2012 in Russia than in 1996 for example), like Arabs and Norwegians do. As a result, Russian economy is severely contracted and Russia is probably not even a top 10 world economy any more, by some estimates.The rouble dropped 300% against USD in the last 2 years.

What to expect? Either a massive financial crisis or nothing. Europe is export oriented so weak Euro is a gift from heaven.Germany,France,Italy,Spain -they all have improved their trade balance, with Spain making record numbers since 1976.In a year or two Europe will recover and be back on track (especially with Merkel hopefully gone) . All of course depends on China,as they are the biggest export market for Europe and USA.If China collapses-the shit will hit the fan.

With regards to Russia-I would not consider it to have any economic importance anymore, as oil prices are not going to recover any time soon and Russia does not produce anything else (well maybe guns, so expect more violence in the middle east and more refugees). It all points to a Venezuela scenario (750% inflation and "special measures"in place).
(This post was last modified: 01-24-2016 05:31 AM by Krieg.)
01-24-2016 05:16 AM
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Messages In This Thread
Why is the US dollar so high? - pitt - 01-21-2016, 03:09 PM
RE: Why is the US dollar so high? - trian1 - 01-21-2016, 03:13 PM
RE: Why is the US dollar so high? - Drazen - 01-21-2016, 03:26 PM
RE: Why is the US dollar so high? - Easy_C - 01-21-2016, 08:56 PM
RE: Why is the US dollar so high? - Oz. - 01-21-2016, 10:03 PM
RE: Why is the US dollar so high? - Onto - 01-21-2016, 11:05 PM
RE: Why is the US dollar so high? - rpg - 01-24-2016, 03:36 PM
RE: Why is the US dollar so high? - Easy_C - 01-22-2016, 06:39 PM
RE: Why is the US dollar so high? - Krieg - 01-24-2016 05:16 AM
RE: Why is the US dollar so high? - Krieg - 01-24-2016, 05:35 AM
RE: Why is the US dollar so high? - Krieg - 01-24-2016, 01:44 PM
RE: Why is the US dollar so high? - jayko - 02-13-2016, 03:03 PM

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