Wednesday, November 03, 2004

The Dollar Took a Big Hit Today

The world does not need to cast a single ballot in a US election to have a voice in our country. They can and I suspect will - vote by simply telling the US Treasury where it can take its war bonds. This has already happened on more than one occasion and will continue to be reflected in the steady decline of the Dollar.

Generally speaking, strong nation states do not have extraordinarily weak currencies - unless something is going wrong (their currency is being dumped for another currency i.e. Dollars turned into Euro's or Loonies) or a deliberate devaluation is taking place to boost exports (and hence balance a widening trade gap). In our case - we have both of these events taking place.


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