Jim Rickards, director of market intelligence for scientific consulting firm Omnis, shares his outlook for the dollar.
Rickards says that they are planning for a gradual, steady decline of the dollar, but that it will eventually crash.
Adds that it's hardly a coincidence that a Federal Reserve governor would have an op-ed piece in the Wall Street Journal on the same day that the G-20 meets.
Summary of op-ed piece:
Fed's Warsh: Policy Normalization Likely Before Need Is Obvious
http://online.wsj.com/article/SB125383509402539303.html
Kevin Warsh op-ed piece: The Fed's Job Is Only Half Over
http://online.wsj.com/article/SB1000...058334138.html
Rickards says he feels this has to do with gold and pre-empting the eventual collapse of the dollar. He points out that a Fed Governor can't talk about a collapsing dollar because it would lead to exactly that, so Warsh has to speak indirectly.
Rickards says the Fed needs for the dollar to go down by half over the next fourteen years. We have 60 trillion dollars of liabilities with no feasible combination of growth in taxes to fund those liabilities.
But what they really want to do is displace the dollar with IMF SDR's, which are Special Drawing Rights.
The unannounced part of G-20 is that the International Monetary Fund is being annointed as a global central bank. They are printing money as there is nothing behind these SDR's.
Jim says buy gold because: *“The problem is, when you own gold you’re fighting every central bank in the world. Central banks hate gold because it limits their ability to print money.”
CNBC News video, Jim Rickards :"Federal Reserve needs to cut US Dollar in half over next 14 years"
http://www.dailypaul.com/node/108994
Posted September 29th, 2009 by krolik
"Federal Reserve needs to cut US Dollar in half over next 14 years"
Jim Rickards, director of market intelligence for scientific consulting firm Omnis, shares his outlook for the dollar.
Jim cracks the code of "Fed Speak" to tell us what is really going on with the Global Banking Elite and their plans for the future.
SDR stands for special drawing rights. They are a product of the International Monetary Fund.
You can think of SDRs more as the "currency" of the IMF and some other organizations. They also are given to IMF member countries in exchange for their "quotas," their up-front payments to the IMF to finance its operation.
Triffen's dilemma
During the 1960 and early 70s the amount of US dollar reserves held by non-reserve central banks grew significantly, which led to what became known as the "Triffen Dilemma." Robert Triffen was a Belgian economist and Yale University professor who highlighted the problems related to dollar overhang. Dollar overhang occurred when the amount of US dollar assets held by non-reserve central banks exceeded the total supply of gold in the US Treasury at the exchange rate of $35 per ounce. Dollar overhang occurred in the system by 1960 and continued to worsen throughout the decade of the 1960s. By 1971 foreign holdings of US dollars stood at $50 billion while US gold reserves were valued at only $15 billion output.
Rickards says that they are planning for a gradual, steady decline of the dollar, but that it will eventually crash.
Adds that it's hardly a coincidence that a Federal Reserve governor would have an op-ed piece in the Wall Street Journal on the same day that the G-20 meets.
Summary of op-ed piece:
Fed's Warsh: Policy Normalization Likely Before Need Is Obvious
http://online.wsj.com/article/SB125383509402539303.html
Kevin Warsh op-ed piece: The Fed's Job Is Only Half Over
http://online.wsj.com/article/SB1000...058334138.html
Rickards says he feels this has to do with gold and pre-empting the eventual collapse of the dollar. He points out that a Fed Governor can't talk about a collapsing dollar because it would lead to exactly that, so Warsh has to speak indirectly.
Rickards says the Fed needs for the dollar to go down by half over the next fourteen years. We have 60 trillion dollars of liabilities with no feasible combination of growth in taxes to fund those liabilities.
But what they really want to do is displace the dollar with IMF SDR's, which are Special Drawing Rights.
The unannounced part of G-20 is that the International Monetary Fund is being annointed as a global central bank. They are printing money as there is nothing behind these SDR's.
Jim says buy gold because: *“The problem is, when you own gold you’re fighting every central bank in the world. Central banks hate gold because it limits their ability to print money.”
CNBC News video, Jim Rickards :"Federal Reserve needs to cut US Dollar in half over next 14 years"
http://www.dailypaul.com/node/108994
Posted September 29th, 2009 by krolik
"Federal Reserve needs to cut US Dollar in half over next 14 years"
Jim Rickards, director of market intelligence for scientific consulting firm Omnis, shares his outlook for the dollar.
Jim cracks the code of "Fed Speak" to tell us what is really going on with the Global Banking Elite and their plans for the future.
SDR stands for special drawing rights. They are a product of the International Monetary Fund.
You can think of SDRs more as the "currency" of the IMF and some other organizations. They also are given to IMF member countries in exchange for their "quotas," their up-front payments to the IMF to finance its operation.
Triffen's dilemma
During the 1960 and early 70s the amount of US dollar reserves held by non-reserve central banks grew significantly, which led to what became known as the "Triffen Dilemma." Robert Triffen was a Belgian economist and Yale University professor who highlighted the problems related to dollar overhang. Dollar overhang occurred when the amount of US dollar assets held by non-reserve central banks exceeded the total supply of gold in the US Treasury at the exchange rate of $35 per ounce. Dollar overhang occurred in the system by 1960 and continued to worsen throughout the decade of the 1960s. By 1971 foreign holdings of US dollars stood at $50 billion while US gold reserves were valued at only $15 billion output.
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