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Pros Have Never Been This Down On The Dollar
Dollar dominance is facing its biggest test in the (short) history of American empire: True or false
We won’t have Trump forever, it just seems like it.
“That the dollar’s struggling despite sticky Treasury yields and a stubbornly hawkish Fed is concerning. That juxtaposition suggests that notwithstanding a lack of empirical data to back up sundry “buyers’ strike” narratives, something’s amiss. And at just the wrong time given America’s financing needs are set to grow.”
Dumb question: how broken are the carry trades in world currencies since “Liberation Day?” (Did they even run that deep to begin with?) I am not certain about the run-ups in gold, silver, or Bitcoin either, as I have seen those markets manipulated before.
What the dollar is doing now is very predictable. Two things are more important than rate differentials. The dollar hates lbeing in a ‘worthless’ war and even worse losing it, and then looking like a loser to the world. Second other than Reagan (who was in no wars), it hates Reublicans in general. The easiest thing for a government to do is trash its currency (all governments, not just the U.S.) Next, war and a dropping currency is great for the military-industrial complex (see Hitler and also Eisenhower’s warning), big Republican donors and voters. Trump hates a strong dollar and says it often. He has also promoted more war and bloodshed in 5 months. My guess is the dollar will decline for the next 3 years. Look back at your history.
Sure seems like most of the DM use the dollar because they have to, not because they want to. Has any other US president even come close to destroying American goodwill like Trump. In 5 months he’s managed to trash every country we use to call ally and friend. If this country badly stumbles, who wont want to pile on.