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cesarpoli May 3, 2007 4:30pm | Post# 1

USD - Something to Think About
 
From: Down River Trading(if you donīt wanna this text here, tell me and I will remove it)

Let's talkabout it !

May 1, 2007

  1. 35 years of dollar weakness is ending in 2007. Since August 15, 1971 we have been plagued by a long cyclical and emotional free for all thanks to Richard M. Nixon. It has now ended officially on April 30, 2007. Beginning in May of 2007, a new long term cyclical US Dollar bull market is beginning. Historical? Yes. Opportunity or Lunacy? You decide.
  2. When you look at a long term chart of the EURUSD, what do you see? Let me ask it differently. What do most see? An uptrend of course. A paralyzed US Dollar that is "doomed". Books have been written, articles, hedge funds formed. Jump on board. It is easy to get wealthy. Just short the dollar. Even Bill Gates and Warren Buffet are doing it. When I look at a long term chart this is what I see. In 2004, a new trend was established. The real trend. In 2005, all the late comers to the party jumped on board to get their share of the wealth. They have enjoyed a nice run back to the levels of the original new multi-year trend. They are all trapped. Soon they will begin to panic. Fear will set in and some big money will realize their mistake. The real trend will now resume from the original ground swell where it began in earnest. It will continue for at least 30 years.
  3. If the dollar is "toast", then it is priced in the market NOW?
  4. The USDJPY always leads the way. Draw a simple trend line from 1971 to present across the downtrend.
  5. Do you really think the biggest economy in the world is just going to wither away. Give me a break? This is what the media wants you to believe. It sells books, causes Forex accounts to be opened and makes people look like experts for a short time. Do you realize how capital flows in the US compare to the so called emerging markets? One click of the mouse can dwarf some of them. Do your research. Don't be lazy.
  6. Is a British Pound really worth 2 times a US Dollar. If you believe this, why?
  7. Will the countries who have purchased long maturity US bonds want the dollar to weaken?
  8. What happened to the twin deficit media push? I'll tell you what happened, they were wrong. Why aren't they admitting it? What will happen to the current predictions now that we are off that kick?
  9. Is the European Union really set to soar economically. They certainly have wonderful employment numbers now don't they. Wages and Labor costs are not an issue now are they? Who is leading who? Germany? No comment.
  10. Just a 10% correction in the US dollar will yield 1300 points to the downside. EURUSD at 1.2150 by the end of 2007. Maybe more. Even if all the experts are right, does a healthy market need to correct or can it just go parabolic forever. Is 10% a good correction? 15%? 20%? Has any market in history not corrected?
  11. A North American Dollar? Mexico, Canada and the United States.
  12. Who has the largest Oil reserves in the World? Do you know this answer? Why does it matter?
  13. What is the purpose of Gold? Is it traded like a natural resource? Why is this important? Why would anyone want to pay $2000 an ounce for a worthless metal? Greed sells doesn't it. Why wouldn't we just find something else of value instead of Gold. No. Wait I'm wrong. Let me carry my gold around with me everyday. On the planes. So convenient. What a wonderful store of value. No...let me keep it in my vault at my house and I will just tell people that I have a lot of it or bring them to the bank to show them. No, No....I will just show them on paper or the internet. Now what is this? Ah yes! It is something just like the dollar paper. Fiat statements of my gold. Give me a break. What a bunch of malarky this gold thing is.
  14. Why don't all the economists and analysts talk about all their wrong predictions?
  15. Is China really ready to carry the torch? Look closely below their publicized middle class growth. What do you find? Are you counting on all these lower class people to push them out the top of the volcano? Good luck, they can barely feed themselves. But they will buy up cell phones and create business right? Just like the homeless in America are doing right? If you take away the lower class in China, what is left from a numbers comparison perspective? Do this and compare the numbers to the US.
  16. How about Japan? That's like saying the US is going to win the World Cup soon.Well not really, the US actually has a chance.
  17. Is World peace coming? Why have things been so quiet for so long? CNN is struggling to find anything that is exciting.
  18. The US Housing Market is collapsing right? From what level? All markets correct naturally. Real Estate is a bad investment in the US right? Why would anyone want to own property in the Untied States? Again, define collapse for me. Media, Media, Media. Yep, we are just collapsing here in the US. Going down the drains. It is a struggle for me. Freedom, High Income, Public Services, Shops, Restaurants, Lifestyle all within a few miles of my home. Fire Department will come automatically if I need them. My kids are in public or private schools.I have a lot of choices on this one too. All my kids have cell phones and their own cars. My kids have jobs and they are still in school. Yes, we are collapsing here in the US. I better leave now if I want to survive. Where should I go? China. They have roads there right? For all my cars.
  19. If there is a thing such as "smart money", why doesn't smart money just work for themselves in an office in the islands somewhere? It is smart to be an emplyee of a bank right? To work for smart money employers. Smart Money is an Oxymoron.

Here are a few of my relevant predictions for the next serveral years
US Dollar Index goes to 150
AUDUSD to .40
EURUSD to .85
USDCHF to 3.50
USDJPY 252
USDCAD to 1.75
GBPUSD .62
Gold to 280 or much lower
Oil to $25
US 30 Year Bonds to 30


leelee75k May 3, 2007 5:15pm | Post# 2

very interesting post. definitely lots of valid points to ponder. i've been having trouble with my words lately so forgive me if i ramble and hope i express my thoughts properly.

The USD.

The obvious and most easiest and understandable opinion to have is to say that nothing can ever kill the US dollar. It won't happen, it can't happen, too many investors, too many rely on the dollar. etc, etc.

I agree with all those bullish dollar sentiments, however what I don't know and what I'll try to explain is the "x factor". Being I am a typical but non typical conspiracy theorist, your questions brings to mind all those crazy conspiracy theories. The thing, the movement, the event, the plot, the evolution, that can cause the dollar to be dissolved. That is the "x factor" the risk of any of those theories to be true is what really moves the market. Some would say that there is a plot by "those who be" or the Bilderbergs to bring the one world government and the Amero. You might even hear that the reason gold is valued as is because The Church owns the majority of it. Cable is at two dollars as a favor to the government for their support?

There are many, many factors that creates the doubt in a currency strength or movement, but world peace I have to admit is the best idea yet.

All markets reverse or change direction based on different time frames and yes it's very possible to see gold devalue dramatically and the dollar get stronger but when and for how long?

is there any guarantee that there won't be wars, terrorism, disaster etc to move the markets? Nope, and there certainly no guarantee that there isn't a group trying to implement the Amero either.

ultimately the markets move in its favored direction to serve "the man"
so rich get richer and richest stay being the richest.

x2012 May 3, 2007 6:42pm | Post# 3

I seriously hope the OP didnt spend too much time writing this up. While I agree with you on some points, I disagree on many more. Only time will tell I guess.


From: Down River Trading(if you donīt wanna this text here, tell me and I will remove it)

Let's talkabout it !

May 1, 2007

  1. 35 years of dollar weakness is ending in 2007. Since August 15, 1971 we have been plagued by a long cyclical and emotional free for all thanks to Richard M. Nixon. It has now ended officially on April 30, 2007. Beginning in May of 2007, a new long term cyclical US Dollar bull market is beginning. Historical? Yes. Opportunity or Lunacy? You decide.

A 35 year trend will all of a sudden halt this month and reverse? Come on...The market has already factored in the dollar's weakness.

  1. When you look at a long term chart of the EURUSD, what do you see? Let me ask it differently. What do most see? An uptrend of course. A paralyzed US Dollar that is "doomed". Books have been written, articles, hedge funds formed. Jump on board. It is easy to get wealthy. Just short the dollar. Even Bill Gates and Warren Buffet are doing it. When I look at a long term chart this is what I see. In 2004, a new trend was established. The real trend. In 2005, all the late comers to the party jumped on board to get their share of the wealth. They have enjoyed a nice run back to the levels of the original new multi-year trend. They are all trapped. Soon they will begin to panic. Fear will set in and some big money will realize their mistake. The real trend will now resume from the original ground swell where it began in earnest. It will continue for at least 30 years.

Tell us your name. In 30 years we will look it up and see whether or not your are a centi-billionaire.
My crystal ball must be broke!

  1. If the dollar is "toast", then it is priced in the market NOW?

Its all factored in....but im not entirely sure what you mean here.

  1. The USDJPY always leads the way. Draw a simple trend line from 1971 to present across the downtrend.

Ok, I see.

  1. Do you really think the biggest economy in the world is just going to wither away. Give me a break? This is what the media wants you to believe. It sells books, causes Forex accounts to be opened and makes people look like experts for a short time. Do you realize how capital flows in the US compare to the so called emerging markets? One click of the mouse can dwarf some of them. Do your research. Don't be lazy.

I dont think its just going to wither away. But it will be taking a beating from emerging markets. Also pick up a history book and notice a pattern with any and ALL dynasties/regimes/kingdoms/political systems or call it whatever you want. Nothing lasts forever. I will eat my shoe if you name anything that has stood the treatment of time.

  1. Is a British Pound really worth 2 times a US Dollar. If you believe this, why?

This point sort of contradicts what you said earlier. If its worth 2x the dollar, then that is the price the market has made for it and that the dollar is infact still getting weaker.

  1. Will the countries who have purchased long maturity US bonds want the dollar to weaken?

I agree here...they dont; but there's a huge difference between hoping for an outcome and the reality. In case you havent noticed, there is a gradual shift occuring towards the Euro now.

  1. What happened to the twin deficit media push? I'll tell you what happened, they were wrong. Why aren't they admitting it? What will happen to the current predictions now that we are off that kick?

Care to elaborate what the twin deficity media push is?

  1. Is the European Union really set to soar economically. They certainly have wonderful employment numbers now don't they. Wages and Labor costs are not an issue now are they? Who is leading who? Germany? No comment.

Pretty sure I read somewhere that the Euro markets have recently passed the US markets in equity value.

  1. Just a 10% correction in the US dollar will yield 1300 points to the downside. EURUSD at 1.2150 by the end of 2007. Maybe more. Even if all the experts are right, does a healthy market need to correct or can it just go parabolic forever. Is 10% a good correction? 15%? 20%? Has any market in history not corrected?

???

  1. A North American Dollar? Mexico, Canada and the United States.

???

  1. Who has the largest Oil reserves in the World? Do you know this answer? Why does it matter?

What happens once it runs out....?

  1. What is the purpose of Gold? Is it traded like a natural resource? Why is this important? Why would anyone want to pay $2000 an ounce for a worthless metal? Greed sells doesn't it. Why wouldn't we just find something else of value instead of Gold. No. Wait I'm wrong. Let me carry my gold around with me everyday. On the planes. So convenient. What a wonderful store of value. No...let me keep it in my vault at my house and I will just tell people that I have a lot of it or bring them to the bank to show them. No, No....I will just show them on paper or the internet. Now what is this? Ah yes! It is something just like the dollar paper. Fiat statements of my gold. Give me a break. What a bunch of malarky this gold thing is.

Agree here....

  1. Why don't all the economists and analysts talk about all their wrong predictions?

Why not just not bother listening to them?

  1. Is China really ready to carry the torch? Look closely below their publicized middle class growth. What do you find? Are you counting on all these lower class people to push them out the top of the volcano? Good luck, they can barely feed themselves. But they will buy up cell phones and create business right? Just like the homeless in America are doing right? If you take away the lower class in China, what is left from a numbers comparison perspective? Do this and compare the numbers to the US.

Umm..yes. There's always going to be a lower middle class and there's always going to be the rich upper class. Its the middle and upper classes that will be shifting the tide. Not sure what rock you live under, but very multinational corporation is running there to rack up profits. Millions of Chinese will be buying their first new car, cell phones and tvs. National Geographic once had an article that mentioned an 80% leap in car sales in the last few years.
Also, I think you have the lower class mixed with the downright homeless.
'Do this and compare the numbers to the US.' Since you clearly did the number crunching, can you please share them with us?

 

  1. How about Japan? That's like saying the US is going to win the World Cup soon.Well not really, the US actually has a chance.

Again...???? What point are you trying to make?

  1. Is World peace coming? Why have things been so quiet for so long? CNN is struggling to find anything that is exciting.

The calm before the storm perhaps? Lets put things into perspective Here's a list of things we have to look forward to this century:
Dwindling oil supplies. Result: US economy suffers greatly due to rising prices. So does the rest of the world.
War over energy sources: again, who will be leading this?
Rising number of nuclear states.
Global warming: devastating world economies.
Mass migrations of people from affected parts of the world.
Not to mention overpopulation, starvation, poverty and overburdened resources.

How exactly do you see world peace out of this? I'm pretty sure you live on planet earth too.

  1. The US Housing Market is collapsing right? From what level? All markets correct naturally. Real Estate is a bad investment in the US right? Why would anyone want to own property in the Untied States? Again, define collapse for me. Media, Media, Media. Yep, we are just collapsing here in the US. Going down the drains. It is a struggle for me. Freedom, High Income, Public Services, Shops, Restaurants, Lifestyle all within a few miles of my home. Fire Department will come automatically if I need them. My kids are in public or private schools.I have a lot of choices on this one too. All my kids have cell phones and their own cars. My kids have jobs and they are still in school. Yes, we are collapsing here in the US. I better leave now if I want to survive. Where should I go? China. They have roads there right? For all my cars.

Probably the most ignorant statement you have posted here. Yes China is still backward in many areas....but seriously, Chinese cities are reaching alpha city levels. China wouldnt even be hosting the 2008 olympics if its infrastructure couldnt handle it. Think about that...
It doesnt matter if your sons/daughters have your $8 an hour jobs making coffee and flipping burgers while they are in school. How are they going to find REAL jobs if they are all going to the Chinese/Indians etc? The US is losing its competitive edge pretty fast. More people graduate with degrees in sports science than in engineering.
Compare that to the hundreds of millions of eager Chinese and Indians who have have better suited degrees.

  1. If there is a thing such as "smart money", why doesn't smart money just work for themselves in an office in the islands somewhere? It is smart to be an emplyee of a bank right? To work for smart money employers. Smart Money is an Oxymoron.

So I guess you would be the 'dumb money' that makes millions? Its called Smart Money for a reason

Just my opinions... Take them for what you want. Also keep in mind that I'm not the most articulate person in the world.

Lets keep this discussion going.

Ted1983 May 3, 2007 6:51pm | Post# 4

House Prices!
 
Hello,

Thought provoking stuff there....
A thought on house prices....

The price of houses must be related to poulation density, supply and demmand and all that jazz.

The UK has an area of 244,820 KM2 and 61,000,000 people, or...
249 people/sqkm.(approx).

The USA has an area of 9,836.630 KM2 and 302,000,000 people, or...
31 people/sqkm.(approx).

So the UK has 8 times the population density of the USA.

The average UK house price is Ģ185,000 ish and Ģ140,000 in th USA,
a ratio of 1:1.32 ish.

Does this mean that a UK house should cost Ģ1,480,000...
Or a US house Ģ17.500...

Oh well, maybe not, just thinking aloud!



Sidus May 3, 2007 6:52pm | Post# 5

This looks very interesting! Some points are right, but others are more like .
I think a good debate about the true value USD should be interesting.

Ted1983 May 3, 2007 6:59pm | Post# 6

Also..
 
The point about the USA winning the world cup. That is just not going to happen, absolutely not, no way. Although I would like to see them do it, seen as England aren't either.

pippy le pur May 3, 2007 8:11pm | Post# 7

2004 was the tax incentive repatriation year for the US. The roaring 20's was a case of the banks flooding the ecomony with paper money, then in 29 calling in all loans. Its a repeat. ? is where are we now? 27?28?29?ouch.There is an old saying, 'who owns the gold makes the rules'. Gold has been a quality store of wealth since King Soloman. All fiat currency become valueless, its just a matter of time. History is the key to the future.

jest1081 May 3, 2007 10:27pm | Post# 8

Bottomline is, i concur with the above statement. China for all its promise do not have they maturity to lead the world economy....yet.

And if those oil reserves empty themselves in time to come, i wouldnt wanna be alive already. Anyway the US and other nations has already had the insight to look forward and agressively started researching on biofuel.

Anyway, i have no views on the long term prospects.

From what i can really see is that the current US weakness is induced. The world market has been exponentially growing to a level that they are almost rivalling the US, which reasons the dollar decline even on a bullish state. Abt US being a market leader, i believe till today, they are still very influential (will be for a very long time) and whats note worthy is emerging nations like China and India will have too look back to the US for commodities like oil this will induce further trade growth and force the Chinese to raise prices...im sure the US and other nations will not wanna sell the commodity cheap anymore due to low reserves and high demand.

I.E. USD should correct...no it must correct.

regards
Jest

x2012 May 3, 2007 10:38pm | Post# 9

Here are a few of my relevant predictions for the next serveral years
US Dollar Index goes to 150
AUDUSD to .40
EURUSD to .85
USDCHF to 3.50
USDJPY 252
USDCAD to 1.75
GBPUSD .62
Gold to 280 or much lower
Oil to $25
US 30 Year Bonds to 30
This thread seems more and more satarical now

BurgerKing May 4, 2007 12:08am | Post# 10

I personally have about 75-90% of my money in USD inspite of the fact that im in Philippines. Having said that, my money depreciated by as much as 5% last April - all because PHP appreciated by that much against USD. Thats one MAIN reason for me to be bullish USD.

Secondly, Im bullish USD because, USD is at a low right now. Daily MACD, Stochastic all showing top heavy for EURUSD, GBPUSD. But the numbers you present are way too far fetched. I sure WISH they would be true but honestly?


Here are a few of my relevant predictions for the next serveral years
US Dollar Index goes to 150
AUDUSD to .40
EURUSD to .85
USDCHF to 3.50
USDJPY 252
USDCAD to 1.75
GBPUSD .62
Gold to 280 or much lower
Oil to $25
US 30 Year Bonds to 30

Next several years? Or next several generations?
I'll keep a bookmark of this page and let 10 generations of my decendants (3 centuries later) keep an eyefull watch of it.

nitman May 4, 2007 12:10am | Post# 11

This thread seems more and more satarical now
I wish those predictions will come true one day


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