If USD collapses

[Aussie]

The Chinese have now a big dilemma.... similar to a poker player that has to keep on calling and raising bets. On the one hand, they have become the buyers of a big proportion of US Govt bonds - the Americans need the Chinese to fund the bailout. This presents a good opportunity for the Chinese: they can just close the tap and see the US$ collapse and challenge World hegemony. But if they did so, the trillion dollars or so they already hold on Treasure notes would be wiped out. So what should Chinamen do?, they ask themselves. It is a classic example of prisoner dilemma - they can both go down or they can share the pain.

Patsy, what ever the Chinese say publicly . . . you can bet they will be doing the opposite in reality.

Recently they said they see little choice but to continue buying US Treasuries. I say BS . . . they are slowly but deliberately exiting USD assets and acquiring gold, mining and energy assets. They are far better poker players than the dumb western governments.

[Craig3215]

Here's the numbers, its interesting that foreign demand for long term debt (bonds and notes) has gone no where since june and demand for bills in that period of time has about doubled

http://www.treas.gov/tic/mfh.txt

[peat]

so its all hot money huh
now thats very relevant to this thread!

however right now USD/CAD hit a new high, NZD/USD pretty much on a low

[Aussie]

To all; the premier of China has said "We have made a huge amount of loans to the United States. Of course we are concerned about the safety of our assets. To be honest, I'm a little bit worried," Wen said at a news conference following the closing of China's annual legislative session. "I would like to call on the United States to honor its words, stay a credible nation and ensure the safety of Chinese assets."

This is it, this is the beginning of "banana republic" time. If the Chinese truly step back and do not support our Treasury auctions, the buyer of last resort will be the Fed. I am sure the Fed has already begun monetizing but without Chinese support, the Fed will be monetizing out in the open for all the world to see. All of the massive bailouts that have been promised will in essence be paid for by the Fed printing more Dollars to give to the Treasury. The Chinese "communicate" in this fashion, they have made a very strong statement to Washington. It is no longer a question of if, only a question of how rapidly the Dollar unwinds. We all knew this day was coming, the day that the markets see an auction without Chinese participation will be horrid. Strap in and hunker down.

Regards, Bill H.

http://www.breitbart.com/article.php...show_article=1

[lakedaemonian]

To all; the premier of China has said "We have made a huge amount of loans to the United States. Of course we are concerned about the safety of our assets. To be honest, I'm a little bit worried," Wen said at a news conference following the closing of China's annual legislative session. "I would like to call on the United States to honor its words, stay a credible nation and ensure the safety of Chinese assets."

This is it, this is the beginning of "banana republic" time. If the Chinese truly step back and do not support our Treasury auctions, the buyer of last resort will be the Fed. I am sure the Fed has already begun monetizing but without Chinese support, the Fed will be monetizing out in the open for all the world to see. All of the massive bailouts that have been promised will in essence be paid for by the Fed printing more Dollars to give to the Treasury. The Chinese "communicate" in this fashion, they have made a very strong statement to Washington. It is no longer a question of if, only a question of how rapidly the Dollar unwinds. We all knew this day was coming, the day that the markets see an auction without Chinese participation will be horrid. Strap in and hunker down.

Regards, Bill H.

http://www.breitbart.com/article.php...show_article=1

Leverage?

Certainly............but pulling out the rug? hell no

I think of it as:

Financially United Chaos, Karma, Extinction, (and) Destruction

Makes a great acronym

It's the new M.A.D.

[Aussie]

To all; beyond stupid is all I can say about the Fed's announcement today! They are going to spend (read print) $1 trillion, to inject into the economy and buy Treasury bonds, can you say HYPERINFLATION! As a side note, CNBC reported "massive" call buying in long term Treasuries early today, can you say INSIDER TRADING! So I guess we are now all saved, again, for the umteenth time.

Treasury yields have immediately cratered about 1/2% in the 10 and 30 year Treasuries, this knee jerk reaction will soon be seen as nothing but a reaction by a bunch of jerks. So the Fed will expand it's balance sheet by another 50% and investors want to buy fixed income securities? They are buying bonds with lower yields when the Fed says they will create more Dollars to buy Treasury bonds that promise to pay in these same over issued Dollars? I don't get it. Well actually I do, and I think anyone buying bonds now will get it shortly, you know where. Mr. (I'm a student of the depression) Bernanke has thrown in the towel and is hyperinflating in plain sight, this will not work and will not stand when the G-20 meets in 2 weeks.

This is panic by the Fed, plain and simple. It is also the admission of failure, failure of all the past plans to unthaw the credit crunch. If you watched Gold today, you saw it down $30 plus Dollars until the Fed announcement, it is now up $30+. If you had any questions as to whether Gold was manipulated or not, today's action should do it for you. Gold had no reason to be down hard except for the fact that it was necessary to "retard" it so a $60 rally would look like a $30 rally, HOW PATHETIC!!! If you had any lingering questions about owning Gold, they should be completely gone as the Fed "rang the bell" today, WE WILL DESTROY THE CURRENCY TO SAVE THE BANKING SYSTEM! No ifs, ands, or buts, this is textbook hyperinflation.

The Dollar has had a huge one day collapse -3% (read, everything just got 3% more expensive in Dollar terms), stocks are giving up their gains, and Gold and the shares are running upward like scalded dogs, these are all to be expected. Treasuries however are very counterintuitive and anyone who owns them and doesn't sell into this rally (unless hedged by Gold) needs to have their heads examined. Yields should begin a huge rise very shortly as the world figures out what just happened today. I cannot stress enough how big today is, the implications are earth shattering. This is the Central Bank of the world's reserve currency admitting failure and panicking two weeks before they meet with their banking "brethren". Talk about bargaining from a weak position, Geithner, Bernanke and co. will be sent to the corner and ordered to wear a "dunce cap" (made of paper mache) when they arrive in London. They will show up to the gunfight with paper knives.

I knew this had to happen, I like everyone else hoped I was wrong. Now we will watch as the smoke pours from the Fed's money printing factory as the presses burn up and burn out. It is almost hilarious listening to CNBC's endless line up of idiots raving about how great this "quantitative easing" is, they don't even have a clue as to what is happening. Wecome to Zimbabwe, a loaf of bread costs $10 billion. I will leave you with this question to ponder, "what is the difference between U.S. Dollars and those of Zimbabwe"? The answer is in the title.

Regards, Bill H.

[patsy]

To all; beyond stupid is all I can say about the Fed's announcement today!

Regards, Bill H.

I just couldn't agree more!

For those who really want to learn Bernanke's thought processes and how he'll do anything possible to destroy the USD, this is what he wrote in 2002:

Remarks by Governor Ben S. Bernanke
Before the National Economists Club, Washington, D.C.
November 21, 2002

http://www.federalreserve.gov/boardD...21/default.htm

The most unfortunate thing is that Western societies (NZ included) have forgotten the consequences of inflation and spurious paper money, and everyone believes that monetisation and reinflation is the way to go.

Rather than leaving the deleveraging and restructuring process take place, they want to fight against it. A fundamental deleveraging process must take place before the next growth cycle starts. Anyway, they will lose because powerful economic balancing forces are in play.

When the USD devalues, there is every chance that most countries will continue an unabated destruction of their own currencies for competitive reasons. That's when the REAL wealth destruction will occur. NZ has already started in this path.

Can Bernanke be impeached?

[Aussie]

Can Bernanke be impeached?

He is appointed by the President and confirmed by Congress. I would imagine that if things got to the point of impeachment talk, the very existence of the Fed itself would be in question.

[JBmurc]

He is appointed by the President and confirmed by Congress. I would imagine that if things got to the point of impeachment talk, the very existence of the Fed itself would be in question.

Yes the- FED or the truth- the Large private bank run by the super rich of the world -just watch the link below for more imfo on the matter

[patsy]

the very existence of the Fed itself would be in question.

That would be one of the best things that can happen to both the US and World economies. There is one bill in Congress, sponsored by one of the very few sane American politicians (Ron Paul) to make the Fed more transparent. However, obliteration of the Fed would be better.