US Dollar Index

Acein8ter · #1 04-22-2007, 10:57 AM

Here is a chart of the US Dollar Index from the early 80's to 07. Thoughts on where the dollar is going? (Looks like weakness going forward) Concerns?

I've heard people say that the true inflation rate = the amount of $$$ our goverment is printing up. They no longer publish M3, but people are estimating it is at ~10%.

gonebroke2 · #2 04-22-2007, 11:31 AM

An estimate of current M3 can be found at nowandfutures.com. The 80 level is huge resistance for the US dollar index and it has bounced off of that level everytime it has hit it. I think this time it is going below it and will bottom out around 45-55. It is going to take several years, but I believe it will. In the meantime, expect gold to hit 2500+/ounce and several of the quality gold shares to be up anywhere from 100 to 1000%. Several of them have already had those type of returns, but we are only in inning 2 of a 9 inning game. This is all in my own opinion.

my favorite "blue chip" gold and silver stocks are SSRI (silver play) and AEM (gold play). my favorite speculative (i.e. gambling) stock is RR.V

ilikeaces86_ · #3 04-22-2007, 11:31 AM

I don't really understand why the dollar is in a decline trading vs other currencies. It would seem we have the strongest and biggest economy in the world and also some of the highest consumer confidence in the world. Can someone who knows more about currency trading let me in on the secret?

ilikeaces86_ · #4 04-22-2007, 07:32 PM

Anyone want to enlighten me?

Acein8ter · #5 04-22-2007, 10:37 PM

The US Dollar is 'fiat' money, it's not tied to anything. It used to be tied to Gold and Silver, but Nixon in the early '70's took it off the Gold Std.

Now it's just a piece of paper and you have faith in our government that it is money with purchasing power. I think the problem is that the government is printing way too much of it for war, ect...

Interesting read:
Greenback

theDetroitKid · #6 04-23-2007, 05:09 AM

balance of services, huge current account deficit

that is why the dollar sucks

kimchi · #7 04-23-2007, 11:57 PM

[ QUOTE ]
I don't really understand why the dollar is in a decline trading vs other currencies. It would seem we have the strongest and biggest economy in the world and also some of the highest consumer confidence in the world. Can someone who knows more about currency trading let me in on the secret?

[/ QUOTE ]

The US economy is not the strongest economy - just the biggest.

Imagine I make pies and you eat them. People always see me making pies and always see you eating them. We both appear prosperous, but it is only me who is truely prosperous as you are just paying for my pies in $US IOUs which are inherently almost worthless and you have no chance of making good your credit.

Sibstitute me for Asia and you for the US consumer/country and you get a tanking $US currency.

Jeff W · #8 04-24-2007, 12:02 AM

[ QUOTE ]
We both appear prosperous, but it is only me who is truely prosperous as you are just paying for my pies in $US IOUs which are inherently almost worthless and you have no chance of making good your credit.

[/ QUOTE ]

It sounds like I'm getting free pie. :P

kimchi · #9 04-24-2007, 01:27 AM

[ QUOTE ]
[ QUOTE ]
We both appear prosperous, but it is only me who is truely prosperous as you are just paying for my pies in $US IOUs which are inherently almost worthless and you have no chance of making good your credit.

[/ QUOTE ]

It sounds like I'm getting free pie. :P

[/ QUOTE ]

You are, but your ancestors have given you the opportunity, you are squandering it, and your children will pay for it.

turnipmonster · #10 04-24-2007, 10:26 AM

[ QUOTE ]
We both appear prosperous, but it is only me who is truely prosperous as you are just paying for my pies in $US IOUs which are inherently almost worthless and you have no chance of making good your credit.

[/ QUOTE ]

this is a very weird analogy. why are you giving us free pie?