The central banks now want to reduce their USD reserves while trying to do as little damage to their own economies as possible. That’ll be difficult. If a sell-off ensues, it will start a stampede for the exits.
There’s little hope of an “orderly adjustment” as Costello opines; that’s just false optimism. When the greenback begins listing; things will turn helter-skelter quickly.
In September, we saw early signs that the dollar was in trouble. The trade deficit registered at $70 billion but the Net Foreign Security Purchases (NFSP) came in at a paltry $33 billion. That means that our main trading partners are no longer buying back our debt which puts downward pressure on the greenback. The Fed had two choices; either raise interest rates substantially or let the currency fall. Given the tenuous condition of the housing bubble and the proximity of the midterm elections, the Fed did neither.
A month later, in October, the trade deficit hit $69.9 billion but, then, without warning, a miracle occurred. The Net Foreign Security Purchases skyrocketed to a “historic high” of $116.8 billion; covering both months’ shortfalls almost to the penny.
Coincidence?
Not likely. Either the skittish central banks decided to “stock up” on their dollar-denominated investments or the Federal Reserve (and their banking-buddies) is buying back its own debt to float us through the elections.
This is exactly the kind of hanky-panky that people expected when Greenspan stopped publishing the M-3 last March keeping the rest of us in the dark about what was really going on with the money supply.
http://www.informationclearinghouse.info/article15440.htm
Note: http://www.informationc...
The Dollar's Full-System Meltdown
Posted on Wednesday, November 01 at 10:27 by DiogenesContributed By
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Am I the only one able to connect the dots and see the connections between this and other events?<br />
I certainly hope not! As this is one of those news stories that stitches together (as outlined in the article) several major moves.<br />
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<br />
“The financial crisis that we now face was created by design. It is intended to destroy the labor movement, crush the middle class, quash Medicare, Medicaid and Social Security, reduce our foreign debt by 50 or 60%, force a restructuring of America’s debt, privatize all public assets and resources, and create a new regime of austerity measures which will divert more wealth to the banking and corporate establishments.”<br />
<br />
“Bush administration has passed the Military Commissions Act of 2006 which allows the president to arrest and torture whomever he chooses without charging him with a crime”<br />
<br />
“Bush signed into law a provision which will allow the president to unilaterally declare martial law… changing The Insurrection Act, Bush has essentially overturned the Posse Comitatus Act which bars the president from deploying troops with the United States.”<br />
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“Bush now has absolute power over all armed troops within the country, a state of affairs which the constitution purposely tried to prevent.”<br />
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The list goes on..<br />
I did include a cheap shot here and decided to edit it out as I see the situation on this continent as dire and my guess the North American Union plays heavily into this <br />
<br />
<a href="http://www.adjunct.diodon349.com/Attack_on_USA/beware_of_the_north_american_union.htm">http://www.adjunct.diodon349.com/Attack_on_USA/beware_of_the_north_american_union.htm</a> <br />
“This is BIG PICTURE stuff - the Unholy North American Union: bigger than sports, bigger than military retiree heath care, bigger than the Hollywood Liberal trash, bigger than all the other issues that capture your attention daily. No news media speaks of this issue. No major radio person is jumping on this as it should be told. Our very nation will be undercut. Our very way of life will be direly impacted. All with no vote by the American Public for or against this unholy attack.”<br />
<br />
Would this be the first time in the history of my generation that such goings on occurred? <br />
It would not<br />
<p>---<br>Diogenes said:<br />
"I am Diogenes the Dog. I nuzzle the kind, bark at the greedy and bite scoundrels."