Wasn't intending this thread to become another debate on Hyperinflation (Which people here have been predicting for what, 4 years now without it happening?)
I will say though, that you are getting too caught up in the fundamental analysis and forgetting the X-factors. This is very similar to the debate that went on maybe 6 years ago where 90% of the people here were predicting sky high interest rates (And that too never materialized).
The key X-factors are that the US buck is still the world reserve currency, and the US Government is not going to allow the dollar to go through the floor. They simply won't allow their citizens to go broke overnight due to inflated currency (Just like the US Government is not going to allow interest rates to rise until the price of houses goes back up). You'd see us Nuke China before that ever happens! Devaluing of the US Dollar is being used right now as a stimulus technique on the $buck, but this policy won't continue once the economy rebounds. The same money that has been printed will be taken out of the economy again, and the US Dollar will return to a stronger value. If you aren't a currency trader, and you invest in dollars (In your 401k, savings account, or whatever) -- You may actually wake up to a nice surprise in 20-30 years, that your savings has much more buying power than it used to. If you are a currency trader, then you have an opportunity here to make some short term cash, as long as you exit the foreign currency back into the dollar once the devaluation period reverses.
Other x-factors to consider for the future: If the new congress sticks to it's promises regarding cutting spending, and balancing the federal budget -- They can work on paying down the national debt and putting the country on a track to financial solvency again. Many possibilities here, depending on what happens in DC. Have "fiscal conservatives" on both sides of the aisle learned their lesson from this election? I sure hope so...
Cheers,
- Hakrjak
I will say though, that you are getting too caught up in the fundamental analysis and forgetting the X-factors. This is very similar to the debate that went on maybe 6 years ago where 90% of the people here were predicting sky high interest rates (And that too never materialized).
The key X-factors are that the US buck is still the world reserve currency, and the US Government is not going to allow the dollar to go through the floor. They simply won't allow their citizens to go broke overnight due to inflated currency (Just like the US Government is not going to allow interest rates to rise until the price of houses goes back up). You'd see us Nuke China before that ever happens! Devaluing of the US Dollar is being used right now as a stimulus technique on the $buck, but this policy won't continue once the economy rebounds. The same money that has been printed will be taken out of the economy again, and the US Dollar will return to a stronger value. If you aren't a currency trader, and you invest in dollars (In your 401k, savings account, or whatever) -- You may actually wake up to a nice surprise in 20-30 years, that your savings has much more buying power than it used to. If you are a currency trader, then you have an opportunity here to make some short term cash, as long as you exit the foreign currency back into the dollar once the devaluation period reverses.
Other x-factors to consider for the future: If the new congress sticks to it's promises regarding cutting spending, and balancing the federal budget -- They can work on paying down the national debt and putting the country on a track to financial solvency again. Many possibilities here, depending on what happens in DC. Have "fiscal conservatives" on both sides of the aisle learned their lesson from this election? I sure hope so...
Cheers,
- Hakrjak
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