Friday, July 22, 2011

Why the USD, the EUR, the GBP and, soon the JPY, will keep going down...

Check this website out.
There's nothing too special or new about it. It is just visual.

The important take-away info is:

"Ten Thousand Dollars $10,000 - Enough for a great vacation or to buy a used car.
Approximately one year of work for the average human on earth." 

And so I ask:

How many global citizens are necessary to support the DM Economies?

Again, simple math, simple drivers:

If you consider that the current deficits in the US, the UK, the Eurozone and Japan are all massive and that economic activity has been lackluster...

How can these dudes grow out of the current mess with loads of austerity packages?
How can these dudes, if they opt to keep on printing money, fund their deficits?

The DM is very, very, very, and repeat, very much, leveraged to EM growth. EM Inflation is, and should remain for some time, the most dangerous threat to the global outlook.

Our times demand large margins of safety.

WTF No Way!

*Disclaimer: charts and data are presented as I receive/see them. Sources are usually not checked for validation and my own calculations are of 'back of the envelope'-type. I am aware that some math that I do myself might be wrong and/or misleading to some extent. In financial markets the rate of change of economic data is often more important than the actual level and the perception of 'what is priced in' is more important than 'what is actually going to happen'. This is actually the way people pick entry and exit points. So... yes, sometimes you might say 'This guy is an idiot, this is way wrong!' with a high conviction, being right. Not to worry. Markets are made of expectations and the clash of conviction between its participants. Portfolio managers know that being an idiot is sometimes profitable and being smart is often a bad choice. It is all reality, sometimes good, sometimes bad. By the way: corrections to my analysis and intelligent debate is welcome. theintriguedtrader AT gmail do com

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