NYT: Foreign Interest Appears to Flag as $ Falls (foreign central banks)

[DeepModem Mom]

Foreign Interest Appears to Flag as Dollar Falls
By EDMUND L. ANDREWS

Published: November 27, 2004


WASHINGTON, Nov. 26 - Investors and market analysts are increasingly worried that the last big source of support for the American dollar - heavy buying by foreign central banks - is fading.

The anxiety was on full display Friday, when the dollar abruptly slid to a record low against the euro after a report suggesting that the Chinese central bank might start to reduce its holdings in the American currency.

Though Chinese officials later denied the report, and the dollar recovered, analysts say the broader trend is that foreign governments are becoming less willing to finance the growing debt of the United States government....

***

"There is an emerging consensus that banks around the world are moving to expand their reserves of euros at the expense of dollars," said Laidi Ashraf, chief currency analyst at MG Financial Group in New York.

The Bush administration has essentially condoned the dollar's decline. At meetings with foreign ministers last week, the Treasury secretary, John W. Snow, repeated the American mantra of support for a "strong dollar" but also for letting "market forces" determine exchange rates....


http://www.nytimes.com/2004/11/27/business/27dollar.html

[fishnfla]

1. Hmmm. Every company that Bush has lead has done so well before

i mean, look at his track record. I'm perfectly confident.

And if the world economy goes to shit, at least gays cant get married.

[AP]

2. Every corp. Bush has lead, he ran for one purpose: personal wealth even at

the cost of that corporation succeeding.

He's doing the same thing to America.

[Career Prole]

3. And the adage reverses itself...

Now it's "The world sneezes and America catches cold".

[cliss]

4. The next few weeks ought to be very interesting.

As the world has its eyes riveted on the Foreign exchange, only one thing can happen: The dollar will go down, down, DOWN. How far down is anyone's guess.

My armchair prediction: a lot of money is going to be lost. A lot of fortunes will be wiped out. Many countries are going to bite the bullet with their dollar holdings.

Many pension plans are going to get hammered; possibly the ones with foreign investment portfolios.

Hurrican Ivan's got nothing on this. Because of Bush. The force of destruction around the world.

[acmavm]

5. I honestly think the American people deserve to know if the BFEE and

their corporate buddies are investing heavily in Euros and the Yuan. I do not believe for a minute that they're keeping the money in dollars, a currency that will soon not be worth the paper it's printed on.

[cliss]

7. There's a shocker.

I've come to the conclusion (from reading here at the DU for about 1 1/2 years) that Bush is not an American Crony. He's a globalist.

Oh, he has his corporate buddies who are really running the show. But the important thing to remember here is that they are not necessarily AMERICAN corporations. They might have offices here, but they have a PO Box in the Cayman Islands, or they're headquartered somewhere else.

This would explain why Bush doesn't care about outsourcing of American jobs. Why they're looking the other way while the dollar tanks. Guess who gets left holding the bag?

[loudsue]

6. THIS will be the issue that changes the world as we've known it -- forever

It is amazing to me how few people in this country have any idea about what's coming. Thanks to the corporate media, tens of millions of Americans' lives will be changed "in the twinkling of an eye", without their foreknowledge or proper education.

Other countries are moving fairly slowly on this, so as not to throw their own citizens' lives into complete disarray, as the global currency switches from the dollar to the Euro -- or even a mixture of currencies. But thanks to the neocons, Americans will be sitting there scratching their heads, wondering

" :wtf: is going on?"

Then it will all be the fault of the "liberals" when we can no longer afford to pay social security benefits. It will be spun that these liberal programs have made the U.S. go bankrupt. Hide and watch. Just because the repukes have been in charge of congress since 1994, (except for a short 2-year 1-point vote spread in the Senate) about 1/3 of our population won't make the connection.

Vote machine fraud and corporate-owned State media will be the downfall of this country.

:kick::kick:

[Old and In the Way]

8. Amen....couldn't have said it better myself.

Especially the part about the liberals being the problem. They (the Republican leadership) will happily have the corporate media sing that tune. And while we devour each other, the super rich will be investing their capital in devloping economies.

They will need a scapegoat and the 45% or so who have faithfully voted Republican will never own up to their ignorance of allowing these criminals to take over our government, empty the Treasury, and ruin our economy. Much better to blame those of us who tried to warn them of the coming disaster than to admit they got bamboozled by conmen running the Republican Party and their co-conspirators in the broadcast media.

[fedsron2us]

9. If foreign central banks are limiting their exposure to the dollar

they will endeavour to do it quietly for fear of spooking a nervous market. No one wants to be left holding the bag when the music stops. Its a kind of duplicitous game in which people will try to talk up the currency with words whilst at the same time they seek to dump it. The danger is that the herd mentality kicks in and panic takes over. In those circumstances those who get out of the door first are most likely to survive.

[Deja Q]

10. Greed has blinded wall street, and those in power in America.

Snowjob can go eat yellow snow for all I care.

They ruined it for this country, but SHUSH!, "American Idol" is on!!!

I've never been keen on capitalism, but over the last few years, all the things that make capitalism bad have had me decide that MONEY is the root of all evil. And the love of it too.

The US is getting what it deserves; it's chosen to do an end-run around the "first world". And the world is reacting in ways that would make nuclear bombs less painful.

[fugue]

11. Looks like I may not be able to afford to emigrate . . .

One of my biggest selling points as a new citizen (nigh near my only one!) is that I have a telecommute job that will follow me anywhere in the world.

But I get paid in USD. . . .

Maybe I can persuade my boss to pay me in yen. (She lives in Japan and gets paid in yen.)

[schultzee]

12. If anyone could, perhaps they should buy Euros?

[ramapo]

13. Does Bush see this as the simple solution to all problems?

Is their idea to simply let the dollar fall far enough to erase the trade deficit, bring back American manufacturing, and lessen the attractiveness of offshoring.

Might it not cause: a bit of inflation as prices of imports soar (oil too), higher interest rates as foreign banks dump dollars and we have to get somebody to buy them, and general economic chaos.

What the hell, he's not running again anyway.

[bhikkhu]

14. I would be poorer if I still had money.

So it was a good day.