Churn's Twitter RSS icon Home icon

  • The Demise of the Dollar?

    Posted on October 6th, 2009 No comments
    The Falling Dollar

    The Falling Dollar

    Word has it that China, Russia, France, and Japan are working behind closed doors to take down the all mighty US dollar. The deal seems to be revolving around the energy sector and pushed heavily by the Arab corner. You probably guessed it by now, oil for the Euro. Or perhaps, oil for gold?

    This is speculation, but the recent demand in gold is quite unexplainable. Inflation is not rampant, retail gold sales are actually declinging, but gold price is rising? The only knowledgeable¬†explanation is institutional buying or some kind of unkown demand. Gold can’t rise without demand, and people are having a tough time figuring out where that demand really is. The Independent in the UK has quickly jumped onto this bandwagon and has written a great article worth reading: http://www.independent.co.uk/news/business/news/the-demise-of-the-dollar-1798175.html

    Now the big question is, will the US dollar fail? Personally I don’t believe so but with pressure from around the world as a united front, it certainly can. But it is also important to note that months before the US invaded Iraq, Saddam dropped the dollar for oil. Roughly 1 month ago, Iran has done the same and coincidentally criticism on Iran has climaxed. I’m not sure if I can say this is a coincidence, but its worth noting.

    On a personal note, I have been short on the USD/CAD since about 1.28 and have made a hefty profit on my currency trading (I use QuestradeFX for my currency trading). All in all, the US dollar is going to get a lot worse before it gets any better. Enjoy trading everyone!


    Leave a reply