Currencies

When was the last time you saw someone pick up a penny off the street? A nickel? A dime? Nowadays, even bums often can’t be bothered to pick up anything less than a quarter. The U.S. dollar has become so debased that these coins are essentially pieces of rubbish. They have little to no practical value.

If we want to better understand the answer to the elusive question of "When will the fiat US dollar collapse?", we have to watch the petrodollar system and the factors affecting it.

Today, more than 60% of all foreign currency reserves in the world are in U.S. dollars - but there are big changes on the horizon...Some of the biggest economies on earth have been making agreements with each other to move away from using the U.S. dollar in international trade...[and this shift] is going to have massive implications for the U.S. economy. [Let me explain what is underway.] Words: 1583

I came to the conclusion several years ago that it was just a matter of time before the world realized that the relative functionality of the U.S. dollar was about to go belly up - to collapse. Below is an explanation as to why I have come to that conclusion and what I think it would mean for the well-being of the world.

When the supply of something is increased sharply relative to demand, the value of that commodity will decline. If the supply continues to increase rapidly and indefinitely, then that item will become worth less and less, with the potential to finally become nearly worthless. This is the Developing Disaster facing the US Dollar and the world. This is the factor that could become the single most important criterion in investment allocation decisions and possibly even for individual financial survival.

What would happen if someday the rest of the world decides to reject the U.S. dollar and that process suddenly reversed and a tsunami of U.S. dollars come flooding back to this country? It is frightening to think about. Just take a moment and think of the worst superstorm that you can possibly imagine, and then replace every drop of rain with a dollar bill. The giant currency superstorm that will eventually hit this nation will be far worse than that.

This is the scenario nobody thinks is possible but really, at the end of the day, it’s not like the U.S. can print money and live on debt forever - right? so when something cannot go on forever what happens when it stops?

The mother of all collapses is still in front of us. Below are my reasons why that is the case and how to protect yourself financially from such an eventuality.

Most of the major financial news outlets and many investors have come to rely on the movements of the U.S. Dollar Index as a daily barometer of the U.S. dollar's relative strength and weakness taking it on faith that the Dollar Index is the dollar – pure and simple. In reality, the Index offers a very distortive view of the movement of the dollar against the currencies that matter most. If anything, recent movements of the Index are a reflection of euro weakness rather than dollar strength. Words: 1019

The US dollar has been on a major surge against major global currencies in the past year, recently hitting levels not seen in 20 years and, as the world’s reserve currency, such changes in its value have implications for the entire global economy. Below are five of the main ones.