tag:blogger.com,1999:blog-5936637281134795592.post215259538578893617..comments2024-03-08T08:55:52.985-08:00Comments on Whispers from the Edge of the Rainforest: To Infinity and Beyond?Unknownnoreply@blogger.comBlogger5125tag:blogger.com,1999:blog-5936637281134795592.post-18608309852490145342010-01-21T09:46:14.563-08:002010-01-21T09:46:14.563-08:00Thanks, Patrick - you anwered my next question aft...Thanks, Patrick - you anwered my next question after reading the Whisperer's pot - namely, what does happen if quantitative easing is attempted for infinity and beyond? <br />Would anyone care to connect the does about what an American currency crisis would mean for Canada and our housing bubble?<br />GMAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-5936637281134795592.post-3040256272822864502010-01-20T20:22:59.088-08:002010-01-20T20:22:59.088-08:00One of the very few very educated blogs on the pre...One of the very few very educated blogs on the present state of the North American economy. <br />ThanksAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-5936637281134795592.post-68072119320816065382010-01-20T12:32:11.788-08:002010-01-20T12:32:11.788-08:00Thank you for all the great articles.
There is a...Thank you for all the great articles. <br /><br />There is a divine providence that protected the U.S. dollar, but the beginning of this decade may signal its demise. As the dollar value tumbles, its status as world reserve currency is now in doubt. The Fed is operating a policy of benign neglect of the dollar, engineering an artificial demand of its own treasuries and keeps interest rate low. This strategy works as long as the world still believes in the supremacy of the dollar. However, this time it may not be the case. At the end of 2010 U.S debt will reach 100% GDP, but the total national debt including state, municipal, corporate and personal exceed 600% GDP according to some analysts. Bernanke, the man of the year, can monetized debt as long as he want, but it will not go unnoticed. Once the dollar lost its luster, there will be less demand for it and interest rate begin to rise. When that happens, America's interest burden will consume a large part of its tax revenue, which in turn incurred more debt. A vicious circle. All this stems from Washington misguided policies of borrowing like mad to bail out Wall Street instead of Main Street. The result, Wall Street given out huge bonuses while over 10% unemployment and foreclosure decimate the middle class. To rub more salt to the wound, the government raises their taxes, throwing the tax payer under the bus. With so much public discontent, 2010 will see a big change in the U.S. political landscape if Tuesday Massachusetts vote is any indication. Unfortunately, it does not matter which political power the American public chooses. In the end, The U.S can not spend itself out of a recession. It has to face the music. It can chose either to stop vilify deflation and let it purges all the mal-investment, to cut spending, to raise taxes, to pay down debt or to continue monetizing debts and face the risk of a currency crisis. Deflation and spending cut seem painful, but of all the calamities befalling U.S. economy, a currency crisis will be the end of a once mighty nation.<br /><br />As for Canada, we are different. We have a special providence with our real estate. Our housing asset defies gravity. Just like a bubble, it can only go up. The fundamental is irrelevant, with such a low interest rate and carrying cost who cares about prices. Buy now or be price out... It is deja vu. Plus c'est different, plus c'est la meme chose. We are not different, it is just that our providence last longer than our American counterpart.<br /><br />Regards,<br />PatrickPatricknoreply@blogger.comtag:blogger.com,1999:blog-5936637281134795592.post-34245246550840323282010-01-20T10:20:04.908-08:002010-01-20T10:20:04.908-08:00Thank you for the good work! every day I get lots ...Thank you for the good work! every day I get lots of great analysis and knowledge from your blog.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5936637281134795592.post-70274257762715354102010-01-20T04:42:03.753-08:002010-01-20T04:42:03.753-08:00Wow. Thanks again. Every week you seem to come up...Wow. Thanks again. Every week you seem to come up with info that is incredibly informative.Anonymousnoreply@blogger.com