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Saturday September 22, 2007
Breaking News

Dollar Dives Down, Down...

Our beloved dollar is sinking in value against other foreign currencies, AP reports. Here are some excerpts from the story...

NEW YORK (AP) — The dollar hit a new low against the seemingly unstoppable euro Friday as the 13-nation currency broke through $1.41.

The currency of the 13 euro nations, which have more than 317 million residents and account for more than 15 percent of global gross domestic product, surged as high as $1.4119 before falling back to $1.4083 by late afternoon, above the $1.4076 it bought in New York on Thursday.

The U.S. dollar fell further against the Canadian dollar after reaching parity for the first time since 1976 on Thursday. One Canadian dollar bought $1.0068 in U.S. currency at its highest point Friday before edging down to 99.95 U.S. cents in late New York trading, barely beating 99.93 U.S. cents late Thursday.

The American currency weakened sharply this week on the back of a decision by the U.S. Federal Reserve to cut its benchmark rate by a bigger-than-expected half point to 4.75 percent. The central bank was responding to market turbulence in the U.S. and elsewhere in the fallout from the subprime mortgage crisis. (Read full story)

As I've said for some time: "Recent rapid home equity increases will eventually self-correct, (due to the global market pressures of trade deficits, war spending, tax cuts for the rich, no-bid contracts, corruption etc.), by dramatically depreciating in value, coupled with big interest rate increases and inflation of consumer goods and services."

Or put another way, way back in Feb. 2005, courtesy The Left Coaster:

We've found ourselves in a vicious circle:

- The value of the dollar falls, which means oil exporters increase the price in dollars so they still get the same value. We keep buying the oil regardless and send even more dollars overseas, which increases the trade imbalance and drives the value of the dollar down further. Lather, rise, repeat.

- As the dollar drops, foreign central banks don't want to be the last ones holding dollars (like South Korea), so they reduce their dollar holdings. Demand for the dollar drops, so the dollar falls, putting more pressure on foreign central banks to dump their losing investment in America. Lather, rise, repeat.

- As the dollar drops, inflation and interest rates increase, reducing Americans' buying power and consumption, stalling the American economy. A weaker economy increases the federal budget deficit, increasing the need for foreign buyers of U.S. treasury bonds, which raises interest rates and decreases the value of the dollar. Lather, rinse, repeat.

Trouble, trouble, boil and housing bubble... just wait until the interest rates double! In anticipation of currency depreciation, Big Biz uses inflation to ensure their own cash creation, pimpin' Lexus cars, takin' private jets to fabulous vacation spots so hot they got-a-lot, Empire built on pretense, it defies common sense that we let them do this, at our expense... Word up, Meshers OUT!!!

The MUFF Report

Brought to you by Inner Rhythm Studios.
Your #1 source for top quality Acid & Garageband Loops.
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Tuesday September 18, 2007
Breaking News

Go, Go Greenspan!!!

Former Head Fed Alan Greenspan has dropped a bomb upon the Repugna-cant Party in his new book, The Age of Turbulence: Adventures in a New World.

The lifelong conservative reveals his personal, if redacted opinions and recollections about former presidents he's served under, the Iraq War, the housing bubble, irresponsible spending and power-mongering by the GOP-led congress leading to, in his own opinion, a deserved ouster last November, and an admission that the real motive in going to war was control of the Iraqi oil supply, just to point out a few highlights.

He has since tried to distance himself from an outright accusation of Bush's complicity, but does not reverse his opinion, and has decried as "unfair" liberal bloggers using his words to support the contention that GWB and Co. lied about the reasons for the invasion.

He also warns of a future shift from dollars to euros as the "reserve currency of choice." A devaluation of American currency of this magnitude would cripple the nation, resulting in a breakdown of the basic services that we, as a society, have come to rely on. His predictions are dire and the solutions are not simple.

The rats are jumping ship again, it would seem. Why this guy would wait to tell us this relevant information until after he stepped down seems disingenuous at best. Oh well, at least they cut the prime rate so we can go deeper in debt!!! Meshers OUT!!!