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AMR/EUR

  • #1
  • First Post: Nov 7, 2007 10:50am Nov 7, 2007 10:50am
What do you guys think of the elites destruction of the Dollar so they can get the American people to beg for their Amero (NAU) when they announce its plans?

One of your presidential candidates believes the Dollar could even hit zero.

Many of the wealthy of America individuals and corperations are taking what they can and "evacuating" for lack of a better word for greener pastures.

Will the Dollar hit zero?
what do you think of the Amero, North american union currency for Mexico, USA and canada?
  • #2
  • Nov 7, 2007 10:58am Nov 7, 2007 10:58am
Quoting Malaysia
This is something to THINK of... just a fruit for thought. Open for DISCUSSION.

Everybody is saying about the DOOM of the US DOLLAR right now. From my FA and some background in ECONOMICS... this is LESS likely gonna happen. The Dollar is weakening... certainly YES... but not forever.

Why I said so? Think... what is happening now. USD is getting cheaper and cheaper everyday. Since the last Interest Rate cut from the FED... even cheaper! Believe me... they might even CUT some more. We all know that the DIRECT CORRELATION between the CURRENCY and the INTEREST RATE. If you still don't know about this... I suggest... STOP trading FOREX Some might think... why is FED so stupid of doing so. You wanna know why?

The main interest of FED or any NATIONAL BANK... including BANK NEGARA... IS TO ENSURE AND PRESERVE THE COUNTRY ECONOMIC GROWTH. They will do this even though by jeopardizing the STRENGTH of the its Currency. The aim now is the ECONOMIC GROWTH. I think the FED is doing a smart move.

Think... with all the hype of SUBPRIME ISSUES storming in the USA now... surely it's affecting the National Economy. From the Fundamental Data being reported... indicating slow or stop or reverse GROWTH of the economics there. What would you do to JUMP START the economic growth?

That is why the FED has to CUT the IR. Lower interest means... homeowners can afford to pay back the LOAN or Mortgage. Banks will get LIQUIDITY again... meaning will get back some of the CASH they've lent out and using that CASH to finance new loans. New loans for houses and construction. With the lower IR... people will prone to BUY more things including houses rather than SAVE it.

Why HOUSING data is so important for the Economic Growth indicator? Think... when you can afford to buy a house... or think that this is the right time to buy one because of the LOW IR... many people also can afford it and thinking alike... create DEMAND. Hence, the SUPPLY will automatically increase... meaning more contractor or developer making houses. More houses need more concrete... cement... wood... raw materials... paints... wires... fan... aircond... kitchen equipment... furniture... pet... security systems... even insurances! :surprised

See what I mean? Indirectly the housing growth affecting all others industries including service industries. Look at now. With the cheap currency and low IR... isn't it convincing for foreigners to BUY a house in the USA?

Another thing to THINK of... what happen to the people in CANADA now? They all rushing to USA for SHOPPING What actually benefiting from this? USA economic growth of course!

We as Malaysian... which overseas holiday destination is more convincing to travel to after taking consideration about the cost? UK >>> the Pound getting expensive, Europe >>> the Euro getting expensive. USA >>> the Dollar getting cheaper. What actually benefiting from this? USA economic growth of course!

What happen if the Economy grow bigger and bigger? INFLATION occur. If this happen... FED can start hike up the IR again. Wallllaaaaaaaa.... the USD will strengthen.

Just throw a stone in a pond. You'll see ripples. Observe how the ripples traveling from the centre outwards. Right now... we all know that USA experiencing SUBPRIME PROBLEMS and trying to solve it by CUTTING IR. What about UK? Europe? Malaysia? When or Never?

Back to basic.... EQUILIBRIUM.

Don't ask me when is the BIG REVERSAL... or the long awaited TURNING POINT. Seriously... I DON'T KNOW. That's why I am always vigilant about this... and get ready to change my TRADING PLAN from BUY FROM DIP to SELL FROM BOUNCE.


Just cut and paste. if you don't mind. Too tired to write it all again. That's just from my own opinion.
  • #3
  • Nov 7, 2007 10:59am Nov 7, 2007 10:59am
It's impossible to hit zero. Some time soon, cooler heads are going to prevail and the dollar will recover. Keep in mind investors like to buy low. Well the dollar is at an all time low.
There is a real possibility that the ECB will cut rates tomorrow. That would help more than anything.
  • #4
  • Nov 7, 2007 11:02am Nov 7, 2007 11:02am
You are wrong about one thing. When the fed cuts rates, that actualy raises mortgage rates and when they raise Fed Rate, it can lower mortgage rates. This is because the mortgage lenders use bonds to price their mortgages.
  • #5
  • Nov 7, 2007 11:10am Nov 7, 2007 11:10am
Quoting bhale
You are wrong about one thing. When the fed cuts rates, that actualy raises mortgage rates and when they raise Fed Rate, it can lower mortgage rates. This is because the mortgage lenders use bonds to price their mortgages.
That's is why I said open for discussion... CHEERS MATE Now I learn something new
  • #6
  • Nov 7, 2007 11:29am Nov 7, 2007 11:29am
Quoting bhale
You are wrong about one thing. When the fed cuts rates, that actualy raises mortgage rates and when they raise Fed Rate, it can lower mortgage rates. This is because the mortgage lenders use bonds to price their mortgages.
you must be joking
"Abandon all hope, you who enter here" La Divina Commedia, Dante Alighieri
  • #7
  • Last Post: Nov 7, 2007 11:30am Nov 7, 2007 11:30am
It's theoretically impossible for the dollar to hit zero... it's not like the US is a company that will file for Chapter 11 when the shit hits the fan.

As for hyperinflation... that's a possibility, but it will spell disaster for the global economy as there are a ton of financial instruments around the world tied the USD, including many countries which have their currency pegged to the USD (Saudi Arabia being one of them). After all, it's not like the US is some 2nd world country, like the places that had to re-evaluate their currencies in the recent past, due to double and triple digit inflation (ie: Mexico, Turkey, Poland).

The NAU, or Amero, as it's more recently been called, has been a concept punted around the day after NAFTA was approved about ten years ago... it's nothing new. The reason why people started paying attention to it recently is because a few Canadian politicians were expressing interest in it, and some else gave it a fancy new name. As for going through, this still depends somewhat if Mexico is interested... and now with the USD/CAD falling like a rock, those Canadian politicians are probably starting to reconsider.
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