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Question regarding USD

  • 28-09-2008 3:48pm
    #1
    DefenseSoapEire
    Closed Accounts Posts: 61 ✭✭


    Will this massive loan that the US government are getting result in the dollar value decreasing ?
    Or will it even have a direct impact ?

    :confused:


Comments

  • #2
    failsafe
    Registered Users, Registered Users 2 Posts: 569 ✭✭✭failsafe


    Most probably. The problem being that the US government don't have any money to lend, so they'll probably have to print the money. When this happens there's more dollars in circulation chasing the same amount of goods and services, and therefore the purchasing power of the dollar will fall. I have money in US stocks and I'm seriously considering selling up and moving my cash back to Euro, that's actually why I came over to this board, to ask advice from others on selling my dollars!


  • #3
    DefenseSoapEire
    Closed Accounts Posts: 61 ✭✭DefenseSoapEire


    I have a nice few dollars put away for my next trip over. Will be interesting to see how it works out. Thanks for the advice :D


  • #4
    Économiste Monétaire
    Closed Accounts Posts: 2,208 ✭✭✭Économiste Monétaire


    As far as I'm aware, they will finance this the same way the federal government regularly finances its debt:T-Securities. Will it cause a depreciation in the Dollar? Possibly, but nothing major. The $350 bn is quite small in comparison to Treasury borrowings every year, something like $5/6 trillion.


  • #5
    SoCal90046
    Closed Accounts Posts: 192 ✭✭SoCal90046


    failsafe wrote: »
    Most probably. The problem being that the US government don't have any money to lend, so they'll probably have to print the money. When this happens there's more dollars in circulation chasing the same amount of goods and services, and therefore the purchasing power of the dollar will fall. I have money in US stocks and I'm seriously considering selling up and moving my cash back to Euro, that's actually why I came over to this board, to ask advice from others on selling my dollars!

    The other option is to borrow, which wouldn't necessarily cause a decrease a value in the dollar against other currencies. There are a lot of things which drive exchange rates.


  • #6
    failsafe
    Registered Users, Registered Users 2 Posts: 569 ✭✭✭failsafe


    And from whom shall they lend?

    Is anybody here familiar with Peter Schiff? I've been watching a few interviews with him over the past few days. He makes some interesting points about the risks of the bailout and the impending decline of the dollar. What does anyone else think of his Economic assessment?

    https://www.youtube.com/watch?v=PO-JLGbrpXI

    https://www.youtube.com/watch?v=a6kUUtRueBQ

    https://www.youtube.com/watch?v=JGdj3Gx4A8w


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  • #7
    eamonnm79
    Closed Accounts Posts: 459 ✭✭eamonnm79


    One thing is for sure, Peter Schiff has a financial interest in telling people to buy foreign stocks. His Company specialise in giving american investors global exposure by buying foreign stocks.

    That doesnt mean he is giving bad advise nesseserily, but just that if people listen to him, it could help the industry he is in, grow rapidly.


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