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Countdown to Dollar Implosion Ticks Off Financiers


Unbacked predictions permeate the financial sphere, but the dollar is actually returning to normal.


It never ceases to amaze me what hype people will believe. The latest is a series of posts by Jim Sinclair who, on August 14, started a countdown to dollar oblivion.

August 14, 2009: The Motivation Behind The Countdown

85 days to go! ...

The primary reason for this "out-on-the-limb statement" is that the recent China/US financial Summit meeting in Washington, which was requested by China, wasn't significantly pre-planned.

As I understand it there are two things wanted and one thing disapproved of.

The US financial leadership wants, but more so needs, Chinese buying of US Treasury offerings to remain at these levels, but more so to increase to offset the wholly unavoidable increase in offering of US Federal Debt.

The Chinese wish to see the USA support the creation of a Super Sovereign Currency as an offset to dependence on the dollar for international settlements and national reserves.

The Chinese rightly feel that the greatest risk to their present dollar position's valuation is quantitative easing -- or simply put, the monetization of one's own debt by the electronic creation of money for funding yourself.

I am informed that Chinese interests want to see both in 2009.

Tools of timing, some I haven't shared with you, indicate a major potential turning point that could easily see a break below 0.7600 or 0.7200 coming in the final quarter of this year.

Add this all together and you get a November bull's eye for a loss of confidence in the US dollar internally as well as externally. That will end the misguided belief that MOPE, via its tool SPIN, defeats economic law.

An 85-day countdown to a break on the US dollar below 0.76 from 0.78 hardly seems worthy of a countdown.

And it would be nice if Sinclair told us a bit more than, "I am informed that Chinese interests want to see both in 2009."

Informed by who? A top ranking official? Minnie Mouse? Uncle Joe? At least give us a hint.

Okay, the US and China met in an unplanned meeting. This is grounds for a "November bull's eye" collapse on the dollar? All the way to a shocking 0.76?

If you are going to hype about dollar implosions, please hype with dignity. Give us our hype's worth.

August 19, 2009: The Countdown To The Implosion Of The Dollar

My Dear Friends,

You can take your waves, percentages, algorithms, quants, and quarks and throw them directly into the basket. The time for lines and squiggles are behind us. The common shares of the US dollar are, and have been, in a long-term downtrend. That downtrend is 81 days from implosion. The selling of the US dollar and US dollar instruments is increasing in international markets, making it ever more difficult to manipulate the popular US dollar index, the USDX...

COT has cooked its own goose...

China holds in its hands the future of the category, "Foreign Purchasers of US bonds."

China wishes the annihilation of the Fed policy of "Quantitative Easing."

The Fed wishes to accommodate China.

The US Treasury is absolutely opposed to any such consideration as it would cement the present administration into a one-term wonder.

The US Treasury must win this battle because the boss of this opposition has the power to appoint the new Chairman of the Fed, either Summers or Geithner.

China, as spokesman for the BRICs, has publicly stated its desire for the institutions of a Super Sovereign Currency. This isn't an intended as an immediate substitute for the dollar as a reserve currency, but rather an alternative in new commitments.

It is my understanding that the BRIC countries, not China alone, have given the US until early November to deliver...

As a result of the above, I see 81 days left for the US dollar.

The gold price has but one criterion, and that is the US dollar. Martin Armstrong and Alf Fields are correct on the levels awaiting the gold price.

I know $1224 and $1650 are certain.

Once again, inquiring minds must ask the obvious "understanding from who?"

The odds that the BRIC countries (Brazil, Russia, India, China) got together and gave the US an ultimatum on anything for November are none and none.

By the way, can I have a time frame on that $1650 please? Is that also November?

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