Hyperinflation a real possibility if foreigners drop the dollar
Jim Rickards was interviewed by Casey Research and he is quoted as saying “All of the developments you mention, a GCC central bank, a BRICS multilateral bank, and the increasing use of the yuan are significant straws in the wind all pointing in the same direction—the decline of the dollar as the global reserve currency…While no one of these developments is decisive, each one of them represents an alternative to the dollar for a specified set of transactions. Cumulatively these developments could push the dollar past a tipping point, where it collapses suddenly and unexpectedly after an initially slow decline.”
my question is: What will the dollar collapse look like?
Lindsey said……..it will be a 30% haircut in purchasing power…..at first,,,
It will be abrupt. You will not have time to respond or take evasive action. Exactly like what happened when the gold window was closed or when we went off the gold standard. The devaluation is intended to take everyone by surprise….not just our overseas creditors.
that is the great thing about this site…….IT IS NOT A SURPRISE…….
JERRY AND ALL:
This GOING TO HAPPEN – NOT IF BUT WHEN!!….YIKES
Cory, I am not sure where Hyperinflation comes into play here, can you explain your Subject title?
Hyperinflation a real possibility if foreigners drop the dollar
Bobby…….I think the article you posted of Lindsey’s and this article go hand in hand…
Jerry, exactly, but even here, there is no acceptance.
There will not be a hyperinflation. Don’t even give it a second thought.
bird……if , we get a 30% hit on the dollars,,,,,would that be a possible hyperinflation,
Hi, Bobby — I think about this a lot.
Even if a dollar collapse took place (and I think it will), there are still many unknowns regarding how it would unfold.
For example:
(1) will the fiat currencies collapse domino style (for example, could the dollar retain status for a time as a reserve currency as others lead the way down — the Japanese Yen for instance) or will a trigger event cause a general collapse in paper of all kinds versus. anything that is real.
(2) how severe will be the associated social disorder. In other words, while this is going on, how skillfully do nation states manage the crisis? Are distribution networks of food still operational? Is there martial law — is there general chaos? Is there, God forbid, a World War… a general famine?
Is the crisis short and sharp — is the worst part contained within the scope of a few months or a year or is there a global depression that drags on for years?
You could own a ton of land and have a stockpile of gold and silver — but if the disorder is so great that everything is once again up for grabs — what does it mean?
It falls into the category of ‘be careful what you wish for.’ As a gold bug, if you think about it, you want the gold and silver to be re-priced in dollar terms in a way that accounts for the tremendous build up of credit and debt — but with enough stability that permits our institutions, law enforcement, courts, etc. to still be functioning. None of this matters if the assets are taken away from you or if your main activity during the day is trying to come up with some food and fresh water.
I will tell you this… 5 or 10 years ago if I talked like this, people thought I was entirely out of my mind. Now, mostly I get head nods. That alone, tells me we are a lot closer to the breakdown than we want to imagine.
I think there is a growing recognition of how tenuous… how fragile… our societies have become. It’s dependent upon the world’s greatest confidence game and the hope that credit and debt can forever expand. But like I once said to Al: we can go to bed on a random Tuesday night with the status quo apparently intact; yet wake up on a Wednesday morning to a new world.
Is that walking a bit of a tightrope of hope?
(2)
Eric, thanks, that is well thought out! perhaps the “nods” are a good thing. I pounded the table for gold for over 10 years to my friends, when they finally got in 2010, the decline began. so, is it just your circle of friends or is the world becoming aware of the dollar demise.
I believe government has done a great job in covering up the mess by feeding the people, pumping up the currency, blowing up the bubbles, etc. so that the general public does not even realize what is going on.
Lets hold our breath on years of crap predictions!?!!!
Gezzz can you imagine the price of bitcoin if hyper inflation kicks in or if there is a currency collapse. What is interesting is people in China are using bitcoins to get into USD… which is why I think the senate likes it so much.
Drug dealers too. Who d you think created it?
Seriously Bob M say go ahead and buy bi coin….actually it makes more sense than gold period. But he has a one track mind for a reason..
“Bitcoin makes more sense than gold.” This place is turning into a comedy club.
I reckon you ain’t seen nothing yet Matthew…..it’ll get worse before it gets better IMO.
But I’ll just quietly keep stacking physical & profitable mining stocks.
Matthew,
RIGHT ON! A BAD ACT TOO!!
Brett, Billy, Matthew I’d be interested to hear your comments re what I wrote (about a third of the way down under Gary S) ref bitcoins. For me bitcoins are the dancing queen who lures everyone onto the dance floor until everyone ends up holding a ‘dear John’.
Re the U.S. dollar, the China/Japan stand-off is anything but resolved. With China the number one foreign holder of U.S. debt and Japan at No.2, whichever side America takes (and it still has a treaty with Japan), if either of these countries retaliate by selling off their U.S. debt it’s surely got to be bye-bye the dollar?
When you are at war you get to repudiate your debt to your creditor adversary. The obligation evaporates. It does not get repaid unless the other warring party has the power to blockade and make you pay. Don’t worry about that.
USD is the only currency that whatever I country I got to, that the locals will take. Hell in Australia I can sell my USDs to them for 5% over spot. In Argentina you get a 10% discount for using USDs as payment. Problem is you can only carry $10K across borders.
I enjoy contemplating the intricacies of Rickards offerings.
For whatever reason reading this made me consider the following…..
I sometimes wonder why at current exchange rates someone would favor a Silver American $1 denominated USD Eagle as compared to a Silver Candian $5 CAD Maple.
The Maple is a beautiful coin.
As when backing out an expected destined be re-invested dividend out a considered stock purchase so might you back out the downside denomination in the silver $ market.
Richards said the Euro was a screaming buy at 1.80 now at 1.36. That is just one example of his forecasting.
That’s interesting since the euro has never been even close to 1.80.
Matthew,
Exactly……har you have no idea what you are talking about…the EURO has NEVER been close to 1.80. You just blew your cover as a complete_______ fill in the blank – I am a gentleman.
Dennis…….MAPLES ARE …… .9999 silver Silver Eagle …..are….. 99.9
that makes a maple with a little bit more silver syrup………….
Don’t kid yourself. It makes absolutley no difference what denomination is written on the coin. It hardly matters what the purity is either within relative bounds. A silver coin is worth a silver coin to the average person. Most won’t know squat when it comes to one that is .999 pure or one that is merely Sterling or less. All of this is just marketing, hype, semantics and sales gimmicks.
Not totally true Bird………it will make a difference to coin traders, and collectors ,,which is a rather large group…………
I do agree that most will not know squat,
I’ll be listening to the Williams program again this weekend – as I recall from the first time through, he specifically says there won’t be a “dollar collapse”, but calls it a “global currency reset”. I suppose that to mean that some currencies will be hit harder than others, depending on what assets there are to back the currency in question.
What he(Williams) is implying is that the IMF…..will have 200 plus countries go along with a reset, and none of the currencies will be depreciated more than 5% ,,,,but, the reset will be tied to the assets of the country………….and since….the USA is broke, and really does not have any asset left,,,,that would cause the dollar to take a 30% hit and not collapse at this time. The time table for the event by the IMF,according to Williams is three months.
Hi, Irwin
what is the Williams program — I am unfamiliar. thanks, Eric
Mr Have Your Pencil Ready.
That is funny!
“and your paper……..”
Har,
The EURO was at 1.80……what ARE YOU TALKING ABOUT?! You blew your cover…whatever cover you had – that is.
The one posted yesterday by Bobby;
http://radio.goldseek.com/nuggets/williams.12.04.13.mp3
As bird said. Virtually zero possibility of hyperinflation. I talked to a manager that rode the gold bull and hopped off at the top. “Maybe if USA and Ja
apan print 5 tril a year. The velocity of money is down 50% and there’s tons of deflation in Europe. Europe needs another major crisis for gold to move up. Not buying gold and he’s actually making money!
Golds dead in the water for now and pretty hard for gold bugs to grasp. Listen to what you want to convince yourself to keep hoping. Hope doesn’t make a good investment theme last time I checked..
You got pounded by Bob’s picks and now your an expert? Good one.
Matthew,
These cant handle your common sense – it is too much for them!
Back in school, I’m doing so much lenigran.
Buy gold the economy is doomed. Nope better than you think. http://www.moneyandmarkets.com/why-2014-will-be-even-worse-than-2013-for-bond-investors-56721
John William at shadow stats is respectable but has been wrong for years.
Well Matthew ya put a little faith in someone and you do your day job and ya come back home and oops.
Actually There are some unbiased opinions out there. And I’ve had to do a shit load of research and back to general market cycles and TA is what we had to revert too. No expert but the trends is down until. Bob pounded the table to sit and wait as he said he’s been here before and through the 70s. Waiting was the dumbest thing we’ve ever done. Following some objectionable guys that don’t fight the market. Blind faith in someone that thinks he knows ahead of time is pretty stupid. I know a lot of folks layer out by Bob and that his continued bragging about that he would know when to hit the sell button like he did in Jan 1980 well. His fear mongering in the early days was warranted. But he’s doesn’t know and nobody know for sure.
On Williams he’s been talking about going over a cliff for eons that’s a fact.
I outperformed Sprott!! Hahahahahah
This is fun thanks for the forum guys!
I’ve narrowed down a few guys that make sense and have a history of getting in and out safely with some excellent forecasting for a couple decades. And I won’t ignore my instincts again. Cheers and beers
Follow what makes sense and decent analysis.
Toms one http://www.mcoscillator.com/learning_center/weekly_chart/gold_cot_data_again_proclaiming_a_price_bottom/?utm_source=McClellan+Chart+In+Focus+-&utm_campaign=2ce6907e81-CIF_Gold_COT_Data_Again_12_6_2013&utm_medium=email&utm_term=0_9e79f8200f-2ce6907e81-129032382
So Matthew what I’ve been thinking is a lot of talk over QE and other driving forces of the market overshadows what’s really going on? Everyone yakking about tapper but something else is now in play no one sees. Markets looking 6 months ahead and not what most are jabbering about. Old news??
No it’s not all about me 🙂
Every manager that was a home run hitter and all the people followed (so called expert) has blown them selves up in the last 10 years or so. One guy I know Tom Stanley with 28% compound returns for 25 years and in heard of when you handling $250mil. Bought into natural gas big time because the oil gas ratio was skewed so bad. He figured it will revert. Well a little tool called fracking comes along and boom your tack record is a bucket of shit. Fortunately by luck I sold out ahead and the same for Sprott and his silver bandwagon. There are more but the point is there are no experts. So if you have 7figures you can talk to some of the tops guys as I have. There one manager I know I would trust with any amount of money these days and that’s sad.
Jerry,you sound like a free n fair Federal Reserve mouth piece.
Since the spring of 2010, our national debt has increased a staggering 46%, from $8.4 trillion to $12.3 trillion today. Also, the inflationary increase in the money supply, which is based on the Fed’s balance sheet, has increased from $2.3 trillion to $3.9 trillion today. That’s a remarkable 70% increase.
Paul Craig Roberts
Their doing what they got to to holder together and it’s kinda working!
Accept for the majority of the middle class. One day she’ll crash and burn. Good thing I don’t live there….
The problem is that America,,,with open arms………let in a bunch of socialiat,communist …….which are running the show,,,but, American with a brain have now become aware,,,that the morons have to go………….
there is no…..free lunch…………….
If ya got to come to Canada and get a free lunch. This gov is really starting to piss me off. 6% of the hardworking class pay for 48% of the useless eaters.
Eventually we blow up too. You can spend more that you take in.
Our money is turning in to used toilet paper.
What about the other 46%? What are they doing?
Jerry,it is time to wake up from your little dream you got going.
The free lunch is taken by the elites over the wee Canadians that are forced into serfdom.
Actually,they take the food,the table and the house and schmoes like you don’t get it:
http://trustbreaker.blogspot.com/2007/10/income-trusts-real-scandal.html
Phmeanenol breakdown of the topic, you should write for me too!
Complicit Comex and LBMA with Fed associated banks and paper gold has ‘kept it together’-and that is the USD and their fiat theft ring.
The new spot exchanges are about to usurp paper exchanges.
Exponential Fed money printing in the last three years and they take the world’s alternative currency to the wood shed.Shame they can’t convince the rest of the world their fiat thingy is as valuable as gold.
80%+ of the world’s annual production of gold is being bought by the Chinese,alone.
Meanwhile,nearly 70% of the US/Fed debt is being bought by the United States.
I always pay attention to what Rickards has to say, this is not very in-depth but I found his final statement telling.
“There is a set of policy choices the US could make that would preserve and even strengthen the dollar’s role as the leading global reserve currency. These include lower taxes, higher interest rates, breaking up big banks, reduced regulation, repeal of Dodd-Frank, reinstatement of Glass-Steagall, banning most derivatives transactions, improved educational outcomes, smart investment in infrastructure, reduced entitlements, and other structural adjustments. I see little prospect of any of these things happening, let alone all of them. As a result, one must conclude that the dollar is heading for collapse even thought that outcome is not inevitable. It is not too late to make structural adjustments, but it is extremely unlikely.”