It’s All About the Dollar…
April 24, 2008
Like you, I have been bombarded with headlines and stories about rising gas and food prices. On the way to work this morning I saw gas priced over $3.35 a gallon. Wheat prices are up. The price of rice has caused riots in parts of the world. I have been wondering how something so drastic can happen so quickly. Several signs point to the falling value of the dollar.
John Tamny writes on RealClearMarkets:
No doubt the dollar price of wheat, corn and soybeans has increased respectively 136, 203 and 205 percent since 2001. It seems like a lot, and in isolation would make their worries…understandable.
But what all three left out of their analysis is the dollar’s near singular role in the above. Indeed, over the same timeframe the objective benchmark that is gold is up 244 percent in dollar terms. Rather than expensive, food in real terms hasn’t kept pace with a severe dollar devaluation that has spread to currencies around the world.
When inflation outside the U.S. is considered, it’s seemingly hidden owing to the desire of currency experts to compare the interplay of paper currencies lacking any market definition. But in truth, dollar devaluations going back to 1971 have historically occurred in concert with inflationary outbreaks worldwide. And that’s what’s happened over the last several years.
Maybe we should be paying more close attention to the dollar.
Bill Steigerwald of Townhall.com recently interviewed Steve Forbes about the falling dollar.
Q: The stock market seems to fall a percent and half a day. Oil prices just set a new record. The dollar is falling. Inflation is going up. The subprime troubles don’t seem to end. What has suddenly happened to our economy?
A: What’s happened is twofold. One is the weak dollar policy of the Federal Reserve and particularly the Bush administration. I’m a Republican, but I think they have made a grievous mistake here. When you debase your currency — you print too many dollars — strange and unpleasant things happen, such as soaring commodity prices. Since 2004 oil, copper, lumber, steel — they’ve all gone up. The housing market, which was booming, went on steroids. The same thing with a lot of the hedge and equity funds. We’re paying the price for that today.
Then with the credit crisis last summer, what has made that protracted is, first of all, the people don’t know where the bad stuff is. It’s similar to getting a health warning that bags of lettuce are tainted. It may be only a small number, but nobody buys lettuce until they know where the bad stuff is. That’s what’s happening with the subprimes.
But we also have a modern version of a bank panic. Lenders are reluctant to lend, even to solvent customers. The system is frozen up. That’s why even solvent companies in the mortgage business are having a very, very tough time these days. So we have a panic and we have the unknown.
Q: In layman’s terms, why is the fall of the dollar so important?
A: Why it’s important? Every time you go to the gas pump, you’ll see why. Every time you go to the grocery store — why are those prices rising like that? You see it in the impact on the housing market. Why did lenders behave so bizarrely? Well, one of the reasons is that a lot of new players came in with the easy money and lending standards went out the window. When you have that situation with excess money — it’s the equivalent to flooding the engine of a car with too much fuel — what you also have is that businesses are investing more outside the U.S. than inside the U.S.
Q: Is it simple enough to say that the dollar is falling in value because too many have been printed up and are in circulation?
A: Too many dollars out there. Especially when the Fed prints a dollar bill these days, with all the borrowing and exotic instruments, it can multiply pretty quickly — just like rabbits. So you stop breeding the rabbits.
Makes you wonder why this is all happening, doesn’t it?
“Sanctions Speak” aloud in Arizona. A sanctioned business is a “SAD” business. A Sanction business is a business that can identify with it’s CUSTOMERS because it’s customers are Sanction too. Wheat is sanctioned, Rice is Sanctioned, Corn is Sanctioned, Watermelons are Sanctioned.
Sanctions Business minded entities in Arizona, can’t compete, won’t compete and will never ever compete! A Sanctioned Business environment is a Sanctioned Dollar. A Weak Sanctioned Dollar is not a dollar it is a pipedream towards economic security and a more perfect Union.
I think once we passed a Business Sanction Law that has a “COST OF CONFORMANCE” that we’ve never seen before. It was a standalone “Trigger” that is weakning every business in this State. Repeal it, and wait for the Federal Government to end is CHURN” and separate Immigration Reform from Illegal Immigration ratched up for “IIMPACT” reason only!
There is no BORDER SECURITY ACCOUNT with 4.4.billion dollars allocated to it, so there is no 120,000,000 for Sherrif Joe and Andrew Thomas’ IIMPACT efforts.
EEVS MEETS SOCIAL SECURITY, AND THEY BOTH MARRIED “THE REAL ID” BUT WITHOUT 11.4 MILLION DOLLAR “Z” PEOPLE IT WAS A MERE PHONY ACHIEVEMENT, LIKE THE “VIRTUAL FENCE” WE SPENT MILLIONS AND MILLIONS AND MILLIONS AND MILLIONS, AND MILLIONS ON!
I didn’t see Russell Pearce or all those Americans that need a job racing up to Yuma to harvest that corn, wheat, fruit and vegetables. We all know he is working on his BIG SWIMMING POOL using tax payers dollars, maybe he can get some of his friends and family kids to go up to YUMA and pick some fruit and vegetables, We here there is a shortage of workers, and now a shortage of food!
Maybe, the Republican Legislative body can wake up at 3am and call John McCain and ask him does he have any American Citizens he knows in Colo Solo Panama Canal that want to come to America and pick watermelons and fruit because our (NAFTA) pool of workers. He should have some real good contacts being born there.!
It’s CINCO DEMAYO Arizona, where is the FIESTA. Down the Street from our High Impact Prison for Profit. Will those Pesky non felon immigrants “attestation, after “attestation” be allowed to Viva La Mexico? No it’s going to be AZCOPS, AHPA, MCDA, AZCPOA, CLASA, MCCPA, MCPR, GPOA, APA, PPS&LA AND NAILEM CINCO DEMOYO weekend in Arizona. Viva La IIMPACT. No Futbol for you! No Fiesta for you. It’s Apphenshion & Tracking Cinco Demayo Days this weekend. Watch those tans, stay away from “black churchs” because we all know there is an “obama” in every one of them. It will be “Hamas Monday” and “Black Liberation day Tuesday” and Southern Aliance Day Wednesday, “family values” Thursday and can a illegal Canadians get a license Friday!
Happy Arizona, Sanction Business State Capital of America. It’s BEER Tax Revenue day. What a grand ol opre idea of raising the Beer Tax in Arizona, .32cents or even .50 per gallon of beer. Raising about 800 million over two years, offsetting our Alternative Fuel GOP Debacle. Now that is something that will have a positive monetary IIMPACT on the valley. It will increase revenue three-fold while the states taxpayers still haven’t been brought in the loop as to how EEVS is going to be paid for, or the effects of EEVS on Social Security Administrations across the valley. No one in the County Sherrifs Department or County Attorneys Department has explained how our “CRIME SUPPRESSION SWEEPS” are being funded, or how our “SINGLE SITE OPERATIONS” are being funded. No one in the State Legislature has said who is paying all of those STATE IIMPACT fees or the NCCHC or the JCAHO. Who is paying for the Dental, Mental Health, Eye, Group Counseling, and all the Dietary Needs that illegal immigration enforcement cost without again without any direction or plan in sight towards IMMIGRATION REFORM.
Yes, a Beer Tax of $.75 cents to start and a .5 increase every six months until a max of $1.00 has been imposed. That will increase our Tax revenues by far.
It might not sit well with John McCain or Cindy McCain, but like he reported, he gets $58,000 in disability and reported making $405,000. She is reported to be worth over 300 million dollars. So a Beer Tax would not hurt them at all. THAT’S CHOCTOW BINGO MONEY!
“WHO PAYS FOR THE EXECUTIVE OFFICE OF DETENTION?”
BY STRIKING ATTORNEY GENERAL, AND INSERTING, SECRETARY OF HOMELAND SECURITY!
I don’t remember that Border Security Account being filled with 4.4 billion dollars to pay for all these “CATTLE CONGRESS” or “CAMP DODGE” Detention Facilities and all of their great, American Facility Care!
Not the Sherrif, not the County Attorney! Maybe Cindy McCain and the good people of Arizona that loves their Budweiser, can stand up and THIS BUDS TAX REVENUE IS FOR YOU! Ummmmm that’s coldy cold!
Alex Jones has been discussing food shortages and the down fall of our economy. The world population is larger than what we are producing. I incourage you to check out “inforwars.com”. Alex Jones, like you, is a straight shooter. Tells it like it is.