Reply #29: Dollar corrections [View All]

[sweetheart]

As the dollar slides to parity with the deficit, a 30% correction, the ability of
the US empire to print and buy its way out of trouble will end. Combined with high
energy costs as the developing economies start using petrol at US levels per capita,
will drive the fossil-fuels based absurdity of Anglo-Petro-economics to bankruptcy.

Transport costs will increase and increase, until they squeeze business margins and
you'll see the destabilization enter the economy that way. This will cut earnings
expectations and then stock market devaluation will weaken the credit worthyness of
those corporations to borrow money cheaply, and the spiralling knock on effect will
produce indeed, a lotta junk credit, but this fallout is not a terminal eschatological
event, but part of an evolutionary process in capitalism where resources find their
best marginal contribution in a world economy... and a bet on the US imperium is not
good spending common sense. As capital flight sets in towards other economic poles,
the ponzi scheme of circular US borrrowing will eat its own tail.

http://journals.democraticunderground.com/sweetheart/65

So what will change about your life with gas at 10 dollars per gallon? Collapse
is so dramatic a word, pain and poverty of paying the actual cost of the lifestyle
at the pump will correct an errant mammon.