Video: The Inevitable Collapse of the Dollar

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For years the US dollar has been steadily losing value against other major currencies. Every month The Federal Reserve orders billions of dollars in paper money (Federal Reserve Notes) printed to shore up the nations deficit account and banking system. Of course printing money increases the money supply and this has a negative effect on the real value of the currency. It's a vicious cycle with no bottom in site.

[youtube]http://www.youtube.com/watch?v=4n3g5lUgkWk[/youtube]

We just need a person like Bill Clinton again, to run budget surpluses, that helped increase the value of the dollar.

Or, maybe the most sensible solution would be one-world currency. Like what Europe did with the Euro, but on a global scale.

i wish it would collapse already. people have been saying this for years and im sick and tired of hearing about it

source & text: http://notesfromparis.typepad.com/polit ... _topi.html

Interestingly, you can see a clear improvement during Clintons term, but not quite a turnaround.

Who cares though - most of its ficticious money anyway -

Money as Debt - quite a long vid, but if you learn anything new in the first 10 mins is well worth the time (or just watch the start)
[GVideo]http://video.google.com/videoplay?docid=-9050474362583451279[/GVideo]

A theory about the invasion of Iraq is that they had recently switched over to using Euros (vs Dollars) for trading their oil (it was a profitable move at the time). If all the major oil producing countries had followed suit, global demand for the dollar would cease (after all most nations wants to buy oil and therefore needs $'s in huge amounts). This would result in a 'run on the bank' in this case the (anonymous) federal reserve which would devestate the US economy.

Ummm.... actually if the federal reserve is making our currency less valuable and our currency is suffering an overvaluation problem then by being less valuable the fed is actually helping our economy as we increase our net exports, devalue our dollar, and improve our GDP. Really, if one is afraid of our currency being overvalued then one should hate our fiscal policy for creating a deficit that is too large as that increases the value of our currency and thus reduces exports making for a bigger gap.

Frankly, I just think that this documentary is fear mongering more than anything else, and I think that Peter Schiff, while being relatively articulate is also relatively wrong on trade issues as I have read intelligent authors essentially argue against his claims on the nature of a deficit, one of them being professor Robert Murphy who has articles arguing against Mr Schiff here, here, and here. An interesting element about that is that Professor Murphy is backed by the school of thought that Peter Schiff often draws from. If there is a sudden change in the global economy such as a major terrorist attack then there might be a problem but the issue we have is only something that will exacerbate problems. I don't see the American trade deficit as something that will hurt America much or the world, we are not the "eaters" of the world, we are where investors take their money, and in order to invest in America one needs American money and thus one needs to take American money in exchange for goods.

no thanks, i'm not giving up my sovereignty.

As a free human - sui juris - your sovereignty should remain true, independant of any federation or nation state.

Hey, we're still doing better than the Yen!

What? It's not helping America at all, so I don't know how you came to that conclusion. Car companies are still cutting jobs here, and people are still outsourcing work to China and India. We're not increasing exports. Plus, the dollar isn't being devalued because of other countries' currencies becoming more valuable, but because we're printing it into oblivion. If it was losing value because of other nations' currencies becoming more valuable, you'd probably be right. We're losing value to the Euro and the Pound....and the western European economies aren't doing very well...that's not a good sign.

The Reserve is printing money, but it's not going to us. It's just making all of our money less valuable while we're still only making the same amount. My savings account is going to lose ~$120 in value this year because of inflation. More expensive everything and more people slipping into poverty is not good for the economy at all.

global banks and control of money is granting ultimate power to a few people over many. it's essentially the same thing as communism except all the power is focused on the banks instead of the executive branch. look at the federal reserve...biggest bunch of war-mongering crooks....do you really want that world-wide?

I was thinking about buying stock in Caterpillar, because I thought that the weak dollar would help them export more... cheap dollar = lower prices. But they just announced a major drop in manufacturing because the US demand dropped more than the foreign demand picked up. Need to keep looking. But gold and foreign currencies seem like a better bet.

No, that my point really. When you referred to my sovereignty in relation to the US govt. i read it as if you are identifying yourself with the 'US govt' corporation - Rothschild et al. (private owners of the federal reserve & by extension the US Govt.).

Its by the very act of individual people abrogating their common-law soverignty, their freedom as individuals (eg. everyone born into the geographical area called USA choosing to become a US citizen = asset/employee/slave of the 'US Govt' corporation) that goves Rothschild et al enough power to be in a position to create a global and totalitarian government.

Going for gold would seem the safest option intuitively (unless you can accurately predict trends in currency) but not 'virtual' gold in an unseen safe, real gold in your hands that you can split & stash in the woods.

remember... ammo eventually becomes obsolete, gold lasts forever

(this is a joke, im no weapon hoarder, not even in an idelogical sense)

The Fed?? The fed helps a lot in stabilizing the economy, in fact, some argue that good management by the central banks of the world are responsible for the relative stability we have experienced so far. I do not consider car companies and outsourcing that important, and both occurrences can be good things. We aren't yet, but our dollar's value is dropping relative to the rest of the world so it is a matter of time before our NET exports increase. Does it matter why the change is occurring? All of these changes are a matter of valuation, unless you are claiming that inflation is destroying our currency, which is a rather hard claim to make unless we are going into an inflationary spiral, then it does not matter why our money is getting less valuable? Europe isn't doing too badly, and the western European countries are experiencing great growth the last time I checked, really though, that doesn't matter, the real issue is the balance of trade and its stability.

I know, the reserve does print money. Where it goes is a matter of economic distribution that depends upon various other market mechanisms. Your savings account may lose some things to inflation, however, that doesn't mean that inflation is that big of an evil for us as inflation does not cause many of the problems here as the economy can adjust to mild inflation relatively well if it continues over a long period of time, and this small inflation is better than the evil that deflation is, which can cause a greater risk of recession which hurts the people at the bottom more than inflation will. The real issue is that the economy is changing in a manner that is hurting people at the bottom, because in the long run markets adjust to the real value of money and inflation is merely an impact on a nominal variable, not a real variable. The change you see seems to be a long-run(I mean in the sense of neoclassical modeling) change, which means a change in a real variable, which means an actual structural change. We have averaged about 4% inflation since we started up the Reserve, but our standards of living are only showing decline now and other things are changing, this means that the Reserve is probably not what we should be blaming but rather structural changes in the economy.

The question is: how much can your exports grow? America already consumes the bulk of its product, and 85% of the Canadian exports as well. Not to mention what you buy from places like Japan, the south american countries..

I hate to sound depressing, but that is a fact. America is a net importer, not because they choose to be, but because they cannot sustain their needs within their own borders.

Technically as much as they want to. America does consume a lot of stuff, but we also create a lot of value in other ways, GDP stands for gross domestic product, not gross domestic consumption. Really, what a weakening in the dollar means is a change in economic situations and so long as it doesn't happen too quickly then our economy, which is often noted as being very adaptable, will adapt.

How is it really that depressing? America is a net importer and it is based upon economic choices(both in the US and outside) and our specialization. America is a net importer partially because of our specialty in financial services, as I already pointed out, other people need our money to invest in our nation's markets and bonds, but really, nothing prevents America from being a net exporter in other products theoretically. Our dollar dropping will mean that we will export more, that does not mean we will cease to import, nor does it mean that economy will start functioning as a closed economy, it just means that consumption will go down, and production for imports will go up. The shift in the dollar is often seen as a necessary change and the question is how much has it fallen compared to how far it needs to. This piece actually addresses economic changes in the dollar somewhat, and it does not say anything about the gloomy destruction of America or despair about the nature of the world. http://www.voxeu.org/index.php?q=node/699