Send in the Market Timers – The Crash of the US Dollar
Many analysts are conveying that the United States dollar will crash in the very near future. The crash of the U.S. dollar would be an historic event. The reason the analytic experts believe this to be a possibility is the fact the dollar is already down by one-third against other prime world currencies.
The possible crash may come as the result of accelerated spending on the part of the American consumer; and the (continual) manufacture of new money. The result of the two preceding variables causes inflation. As well it may be readily forecast that inflation is going to be prevalent for an expansive period of time.
Another prediction is that United States treasury bonds will head critically south in value: This will adversely affect interest rates in that the rates will skyrocket as a result. The decline in the value of bonds and subsequent increase in long-term rates will plague the nation’s economy even further. The economic recovery will be extended if or when the treasury bonds decrease in worth causing them to crash.
A crash with respect to bonds may be on the horizon due to the country’s treasury’s act of voluminous borrowing. The borrowing is the result of the government’s bailout actions in financially patek philippe hk rescuing insurance companies, banks and corporate entities.
Currently interest rates need to be maintained at low levels to initiate economic recovery. If it becomes necessary to increase interest rates the economy will suffer. However the low interest rates do not encourage new borrowing and if foreign lending institutions do not lend money the bonds will subsequently crash.
Another world aspect to consider as it pertains to market timing is the British pound. The GBP (Great Britain pound) is also another major currency slowly losing its value against other primary world currencies.
It is true that the GBP showed promise a short while back however has returned to losing worth as the British fight hard to pull out of their recessionary climate. How then can market timers address the steadily declining major currencies and the possible crash of the United States treasury bonds?