aristobolus wrote:Jonflyfish wrote:Perhaps another dip is coming.
Either way, volatility is not going away anytime too soon.
Best,
JFF
Jon, a serious question. Is our economic system possibly ready to collapse? Is a new currency around the corner? A new world order? I ask because you seem to have a unique perspective, and not driven by emotion.
Hi aristobolus.
You raise a good question. I'm not sure what the definition of collapse is through your paradigm, but through mine I do not see an abrupt SHTF EOTWAWKI on the horizon. The reason being is that there isn't anything readily available or necessary to replace the USD. And while it does suffer from an increase in supply syndrome from the chairsatan of the creature from Jekyll Island, this is nothing new. The financial system requires confidence. There is less confidence in the US as before but when honestly challenged at any teller or merchant location, nobody is refusing or even questioning accepting the US currency. The US has been exposed in the turmoil from the extremely overgeared (over-leveraged) CDO and CDS markets during economic expansion via easy capital. The consequences are enormous but not a death knell for the US. Having the most transparent economy has allowed discounting and valuation mechanisms to work through price discovery to the point where intervention has not hindered its progress. This is one reason why many markets are discounted with ease (and pain for many) and yet others (i.e. housing) are slower to unwind. The mess in Europe is real. It is also not very transparent with excessive disinformation and misinformation while the great collusionist experiment (euro currency) finds its fate. China has experienced tremendous growth. And while many are talking about a hard landing, it is due to expansion not life support.
In a nutshell, the fiats are all in a race to the bottom. There may be some that race faster and harder than others but the USD will be the stalwart during the battle of the uglies. The USD is still the overwhelming reserve currency of choice and while some have begun some diversification into a greater basket, that approach has already proven futile and reversing course. The flight to safety is still the USD. This is a greater portion of my earlier reasoning that the strength of the USD could be the Black Swan event when most thought the USD would continue weakening. When Europe accelerates negative instability you will see even more USD strength. Will we see a new currency(s)? To wit- most likely yes as some countries voluntarily or forcibly revert back to the old currencies i.e. Greek Drachmas etc. Because the Euro collusion has been exposed as a failure, the chances of a new world order have to be even more remote.
I know the above views might not be popular in this forum. It is all just IMVHO. Of course I can be 100% wrong just like any other. Always maintain that ALL fiat currencies eventually return to their true intrinsic value. However, I don't think we'll go from where we are today to living like cavemen anytime in the near future.
Having said that, I do believe in holding wealth in real money (everyone here knows what this is) and real durable assets as well as being a prepper and a hoarder. This is due to my personal belief in being fully self sufficient and take the responsibility of providing for my family deadly serious.
All the best!
JFF
IT`S ALL GOOD.
