Japan’s Easy Money Tsunami

This explains why currency wars may be temporarily stimulative to export economies, but also why they always end in tears.

http://mises.org/daily/6445/Japans-Easy-Money-Tsunami

Japanese Exports Drop More Than Expected Smashing Adj. Trade Balance To New Record Low

In the "we saw it coming a mile away" category, Japan, Inc. is sinking into the abyss as exports plummet.

http://www.zerohedge.com/news/2013-03-20/japanese-exports-drop-more-expected-smashing-adj-trade-balance-new-record-low

KWN Monday Silver Chart Special

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/1/14_KWN_Monday_Silver_Chart_Special.html

‘SWIFT’ Reaction: Iran May Block Oil Exports

http://www.israelnationalnews.com/News/News.aspx/153853#.T2Z6QNXmOgl

Currency war threatens

http://finance.yahoo.com/news/End-to-currency-dispute-apf-206553150.html?x=0

Differences that threaten the outbreak of a currency war persisted after a weekend meeting of global finance ministers, who left without resolving what to do.

Various nations are seeking to devalue their currencies as a way to increase exports and jobs during hard economic times. The concern is that such efforts could trigger a repeat of the trade wars that contributed to the Great Depression of the 1930s as country after country raises protectionist barriers to imported goods.

"Currency disputes can easily become trade disputes," cautioned Canadian Finance Minister Jim Flaherty.

House slaps China on currency policy, deepening trade dispute

http://www.washingtonpost.com/wp-dyn/content/story/2010/09/29/ST2010092907303.html?sid=ST2010092907303

No one wins in a trade war, and the US will definitely lose this one.

The House of Representatives voted Wednesday to punish China for policies that unfairly favor its exports at the expense of the United States and other countries, the latest volley in what is developing as a global battle over jobs and commerce.

Brazilian Finance Minister Guido Mantega said this week that a quiet "currency war" is underway.

The Fed and US Treasury are doing everything in their power to devalue the USDollar. And folks wonder why owning gold isn't "risky." While the USDollar is the world's reserve medium of exchange, it is proving to be a horrible store of value.

China may retaliate for currency measure

MAY retaliate? How about WILL retaliate? Another dumb move by Congress and the Obama administration will sink US exports. Smooth-Hawley II will doom the American economy.

http://www.bloomberg.com/news/2010-09-27/yuan-legislation-in-u-s-congress-may-prompt-retaliation-businesses-say.html

Russia and China joining the anti-dollar party

It's not just rumor and rhetoric anymore:

http://en.rian.ru/russia/20091014/156468599.html

It's a resonating chorus of allies, enemies, and trading partners. In fact, foreign governments hate a weak dollar for several reasons:

1) USDollar weakness makes exports to the US more expensive, dampening their export-driven economies
2) it reduces the value of their reserves, which comprise of dollar-denominated assets like US Treasuries

Ultimately, dollar weakness should be stimulative domestically for these countries, as imports are cheaper, but it reduces the competitiveness of their exports. And since their economies depend more on exports and less consumerism, the weakness of the dollar threatens their attempts to stimulate their own economies.

The deal-breaker is the fact that the US Treasuries in their reserve accounts decline in value, and these IOU's are promises of repayment from a bankrupt borrower--the US government.

An entry from last year

I posted this almost a year ago, on a sports message board, of all places:

Posted: Thu Jul 26, 2007 1:43 pm Post subject:
There's a lot of misinformation going on here. Some of you guys assume that the high-technology boom and bust cycle is unique. Perhaps it's more volatile than most, but it is far from unique. I happen to believe a similar bubble is forming in real estate that is just starting to implode, esp. in ridiculous markets like south Florida, many parts of California, and especially Vegas. You saw mortgage lenders, esp. ones that serve the sub-prime market get hammered. Wall St. was not unscathed--Bear Stearns and other investment and commercial banks took a beating as well. Seeing how most individuals have most of their net worth tied to their homes, it is a troubling sign of worse things to come. Add in a lame-duck president next year, and a Democrat-elect potentially, and look for the stock market to "correct" itself between now and early 2009. The weak dollar may prop up the manufacturing and tourism industries short-term, but long-term, it structurally makes all Americans poorer--it is not a good thing. Too high, and it makes American exporters uncompetitive. Too low as it is now, and we sell ourselves out to foreigners (I consider our dependence on foreign investors to buy our bonds to support our deficits to be "selling out"--because once they decide to stop buying said bonds, interest rates will soar, and we will be in a real world of hurt). A weak dollar makes the US too vulnerable to global capital flows. How do and would I deal with it? Tax-free equity index-based contracts guaranteeing a minimum of 3%, with a cap in the mid-teens to participate in any volatility and upside. PRESERVING CAPITAL in a tax-advantaged vehicle is HUGE--ask anyone with a math or financial background. I don't care if the NASDAQ goes up 50% next year--I'll take my 17%, avoid any down years, and say thank you very much. And while I am not a real estate broker, I would consider buying some in Detroit. Call me crazy, but I recall when the best business in the early 90's was renting U-Haul's one-way out of California. People were leaving in droves due to earthquakes, navy base closures, race riots, a slumping economy, and the downturn in defense spending. The only growth industry was grunge rock. A house on half an acre (with some earthquake damage) in Beverly Hills was listed at $550,000. Today, it's probably worth ten times that. 12-unit apartment buildings barely 5 years old (built during the 80's boom) were going for $300,000 in Long Beach, as foreclosures hit hard. Today, that same building probably would sell for $4 million. Detroit, tho royally screwed, will come back, altho not back to its former glory, but it will come back. I don't know if oil and gas prices will come down, I don't know if Detroit somehow can reverse the market share downward trend, I don't know if they can somehow make more hybrids, but it will come back, and those $20,000 houses will be worth $150,000 again (at least in some neighborhoods). Hell, you can buy a whole skyscraper in Detroit for $3 million. That wouldn't even buy you half a home in some California neighborhoods. _________________ A cynic is someone who knows the price of everything, and the value of nothing.