This is lifted from comments on another site,
London Banker, and i don't agree with all of it, but the endgame tallies with what most of the sources i'm reading point towards...
I think that 'fall' or 'collapse' in the dollar will happen much sooner.
Quote:
From the London Banker website (comment section):
HISTORY
1.Margin calls on hedge funds
2.Sudden contraction of global market liquidity
3.Huge sales to meet margin calls
4.Trillions of dollars of value wiped off balance sheets
5.High levels of hedgie redemptions
6.More sales of assets
7.Collapse in global prices for equities, debt and commodities.
8.Dollar stronger because lots of funds in London struggling to meet their margin calls in New York.
9.Fed doubles balance sheet
10.Taxpayer largesse doled out to Wall Street
11.Bailouts of autos, airlines, etc. wherever (and ONLY wherever) Wall Street is at risk from CDS liabilities
12.Huge expansion in the monetary base
13.Banks begin to accumulate massive reserves
14.Incoming margin cash (and a lot of other cash) parked in Treasuries
15.Treasury prices up; yields down.
16.25 November: Bloomberg reports US bailout totals 7.7 trillion
FUTURE
17.Margin calls end
18.Deleveraging stops
19.Reduced demand for dollars
20.Reduced need to park cash in US Treasuries
21.US domestic demand very low and imports greatly reduced
22.US trade deficit declines quickly
23.Exporters to US don’t need to need to buy so many US Treasuries
24.Bank reserves used to buy crashed assets, many outside the US
25.Banks start to sell US Treasuries to finance these purchases
26.Net sales of US Treasuries – prices falter then fall
27.US can’t sell enough Treasuries and starts to monetize debt
28.Dollar starts to fall
29.Global equity markets rise
30.Commodity prices rise
31.Supply-side shock in the US leads to shortages
32.US prices rise and US govt. can’t fudge inflation numbers enough
33.US citizens panic
34.Hyperinflation of prices of consumption goods in the USA
35.Dollar falls
36.IMF overwhelmed
37.Exports to USA reduced even further
38.Global economy shrinks again, worse than ever
39.Global depression
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This is good in that there's some 'good' news on face value, like a dramatic fall in the balance of payments, that actually points to an underlying catastrophe in progress.
*gulp*
-----Added 4/12/2008 at 12 : 40 : 53-----
Oh, and the reason i was following up in here:
Bloomberg.com: Investment Tools
the baltic index is dropping again. From 12k to under 700 over the year.
Nothing is moving, which spells better balance of payments for the US, but also massively reduced demand for dollars directly - with the follwing implication being a massive reduction in the amount of asian dollars looking to be parked in US treasuries...
*gulp, gulp*