Does a continued rise in the dollar lead to deflation?
Rick joins us to chat about the market movement today. With the US dollar moving significantly higher and negatively impacting commodities will this result in deflation or is it simply inherently deflationary?
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You bring up a good point regarding the US dollar jj… The fact that there are many potential drivers for the dollar.
Gotta agree with both of you.
I do wonder about just how high the US$ can actually go.
Just a thought, Im not sure a $20 move in gold can be considered big anymore, I still think the time will come when much larger moves will be considered “par for the course”.
We will know when that happens bb as a $20 pop will see no to da moon posting, well at least to $1255 and a $20 drop no calls to $500 or $800, lol
Very good point original!
It looks big in a market that’s been sideways trading for 7 months though. It even got the bears out of hibernation and created a little stir in their black hearts!
bb, I happen to completely agree with you!
What will happen to the Canadian dollar if The US dollar goes to 110 or 120, if it falls further which has been the case so far then we would have inflation in Canada and deflation in The States, That would be s crazy situation if true. DT
DT a 120 US$ index puts the loonie at its all time lows vs the $ at 62, food from the US will be priced much higher as for everything else Canada buys from the US
The BOC will be forced to raise rates to prevent a loonie collapse while oil will be much lower effecting Canada’s overall wealth, it will be as ugly as it was in 2002
jj, a rate hike here will be a disaster, our society is deeply in debt. DT
60% decline in oil has already delivered a very nasty blow to Canada’s economy, when the loonie was .62 oil was either side of $30 the big driver in the loonie reaching 110 was the fall of the US$ starting in 2002 as it was not a strong Canadian economy driving the currency but a much weaker US$ as it fell 50! cents.
The #1 tool any central bank has in effecting its currency value is verbal bs but it never changes a trend, to really cool a rising currency is to cuts rates and to prevent a collapse hike rates, its nasty alright
When the rates start going back to where they should be…….there will be the biggest rush to the bankruptcy courts in history.
By whom, in your opinion, Mr. Moscow?
THOSE on ARM loans………
These loans should really be named. .” ARM” ed Robbery .
I would say the crisis is in the euro and yen, not the dollar.
exactly my point, the Cdn$ rising from 62 to 100 was mainly US$ weakness, just as the $ rising to 120 will be Euro and Yen related, mostly Euro$
Agreed…. but with a little Fed rate hike jitters seasoned in.
Maybe not…………Christie’s Auction brings in OVer $1 Billion in one daily sale…..somebody is getting rid of dollars. …..(per kwn)….. 🙂
I hope Ack is right about gold taking a bellie shot like a civilian airliner hit by a Russian SAM. My JDST shares would blow throw the roof like a mortar fired threw a tin roofed shed.
Deflation plus money printing – the best recipe to get rich with no work. Thank god it is possible.
Rick we know the Feds have pushed the markets into watching all US economic data for a hint at a rate hike cycle, todays complete bs housing starts data was a very strong number boosting the $, if the fed minutes Wed are hawkish the $ will see a follow thru reaction
If there is a negative outcome to the on going Greek issue the Euro$ could get hit hard depending on the situation, terms, that alone can easily send the $ closing above 100