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  • The $64 Trillion Question: What's the Dollar Really Worth?
    How The Plunge Protection Team Fights Back (Been Documenting Their Actions or What I Believe Are Their Actions...They're Brilliant, No Kidding....) Next Predicted Step: The Fed cuts rates.

    What? How? Let's go back to October 2006, when Paulson reassembled the PPT. Paulson repeatedly visits China, to lay out the plan. China stops their factories (in 2008, they did this from mid-July to mid-September, "for the Olympics") commodity prices come down, US "demand destruction" helps to further collapse commodity prices, US government freezes the ability of traders to "short" certain key financial companies, the SEC changes rules regarding commodity trading (due 9/15/08), as well as specifically targeting oil speculators. The CBOT coordinates with large financial institutions to short silver and gold, while the Bank of International Settlements and other central banks, flood the market, by selling off their gold reserves (they'll buy them back later once the market collapses). The US government then shows support for highly leveraged (50-1 capital ratio) "hybrids" like Freddie Mac (FRE) and Fannie Mae (FNM) to prevent a collapse of the real estate/banking markets. Since foreign countries own large amounts of these stocks, they cooperate by helping strengthen the dollar. They are also further held hostage to the strong dollar because their economies are in recession without a buyer of their exports. Commodity deflation and the strong dollar now allows continued Fed rate cuts without inspiring "wage spiral" inflation seen in the 1970's (helps not to have those pesky, strong unions around anymore). Commodity hedge funds implode, further helping to push commodity futures downward (steel, copper, oil, silver, gold, etc.)
    Sep 06 14:43 pm |Rating: 0 0 |Link to Comment |View article
  • The $64 Trillion Question: What's the Dollar Really Worth?
    One more thing. You might mention the Bank for International Settlements and how important their actions are with regards to currencies and commodities.

    www.bis.org/dcms/fl.js...
    Sep 06 13:08 pm |Rating: 0 0 |Link to Comment |View article
  • The $64 Trillion Question: What's the Dollar Really Worth?
    You may also add that China wanted a stronger dollar, and a weaker yuan, while limiting inflation. When that impossibility did not occur...

    www.chinadaily.com.cn/...

    What could they do? Close factories for two months after stockpiling commodities, deflate commodity prices through a demand destruction coupled with the U.S., buy U.S. dollars like all of the world's central banks (with their stronger currency), meet with Paulson concerning holdings in treasuries and FNM/FRE, ensuring both are backed by the U.S. government, and ensure that their GDP rises at least 8% while preventing their own version of a wage inflation spiral. This global economy idea has a lot of moving parts, many of them counteracting. Good piece and thanks for mentioning the Central Bank USD buy-up.
    Sep 06 13:00 pm |Rating: 0 0 |Link to Comment |View article

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