What are people's thoughts on the effect on Australia and the rest of the world of a USD devaluation of 30-40 percent.
+1 The world reserve currency devalues? It would scatter the financial pigeons and send them into turmoil. AU prices would go stratopheric literally overnight.
what about in australian dollars, do you reckon the $A would devalue too? If not gold aint any cheaper here
All US military, NSA/CIA types and associated political enforcers along with the politicians and select bureaucrats will get an immediate pay rise to counter any loss of their purchasing power. Everyone else will enter a financial hell from which only people with tangible tradable assets securely in their posession will be immune. IMF SDR . . . Fiat, round 2 attempted to keep central control over world trade Israel nukes Iran (before the opportunity is lost), Arabia and Persia invade Israel and the last World War is engaged.
LOL I was thinking a third actually, but 20% is a workable figure. When Argentina devalued from 1 dollar - 1 peso to 1 dollar = 3 peso, it was the local currency which took the hit, but as has been pointed out the USA IS the currency of the world. However if one assumes a concerted world economic effort to bring the world's circumstance into a more viable position, AND the insularity of the USA (Lehman's abandoned without warning or forethought) then a self serving devaluation is entirely possible, letting its external debtors take a loss, however an agreed loss. After all what can they do when the big bully boy says tough. The Chinese may have been forewarned and hence their reduction of US debt over the last 18 months. Seizing gold again would not be necessary since they already have reporting requirements (IRS) on transactions over $600 introduced last year. It would bring the dolllar roughly into line with the Euro, the Pound and bingo, a single currency value. Australian dollar goes right up, and our only choice would be to devalue and link to the USD Yes gold goes up, but reporting mechanisms and tax grabs are easy to arrange.
Excellent food for thought. It's only by looking outside the box that one stops being a sheeple. Thanks for the intellectual gymnastics.
I really am in two (2) minds about this and vacillate between the A$ being worth much more than the US$, or more likely the A$ enters into a competitive devaluation race to the bottom, to remain export competitive.
Thanks. That was my idea - and the brains here are very good at thinking these things through - the Alex Jones connect was spot on btw. I think he's in need of a holiday but the devaluation story is entirely feasible, and lining up the ducks, I can see the immense benefits to the USA of such a move - especially if they have mollified their major debtor with a bit of advance warning. China would no longer be under pressure to revalue the RMB, - and all things being equal, it would mean that their internal mechanism would not be challenged by recessions for too long. The giant winners would be gold owners - possibly silver owners and other hard asset owners, The losers would be fixed income people. The banks would win big time - with debts erased overnight, and the decline in wealth by the peasants of little effect to the rich. AUD would be revalued I'd think to parity with the US - otherwise we'd be back to the non-competitive 80's - and also our resources would go up in price and be ignored in favour of thers such as Brazil etc. It doesn't influence my decision to own gold or swap to real estate btw.
Obama to kill the USD to stimulate export growth: http://dont-tread-on.me/?p=11919 . . . Now ask yourself "What does the USA export?" Weapons of death and destruction. Any recovery driven by export growth in the USA will be driven by war. Earth, we have a problem.
Hmm thats an interesting viewpoint. Do you remember the 2000 Olympics, the $A went as low as $0.48 from memory? I had a view at the time this was engineered [treasury], to ensure tourism for the games, I mean how many tourists would have come with the $A at parity?. In the same vein perhaps the current $A is being left untouched to ensure the Australian Economy doesnt go through the stratosphere, leaving the rest of the developed world in our wake? Just a theory, or maybe there's something solid in it?
australia's too small to be able to influence the aussie dollar except in the very short term. the rba will step in from time to time but wouldn't try to set any particular price let alone a high one or a low one. we just don't have the fire power.
The government through the reserve bank has a monopoly on the issuance of money supply. Do you think it a coincidence that the dollar devalued so greatly during the period prior to the olympics?
