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Why the Dollar Has Once Again Emerged As Currency of Choice

money.cnn.com — Stocks are at their lowest levels in about 12 years. The economy shrunk by more than 6% in the fourth quarter. Companies are laying off people left and right.

Who dugg this? Made popular Mar 3, 2009

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  • eastwood24, on 03/02/2009, -20/+79In your face Europe!
  • Hillsfar, on 03/03/2009, -5/+49We're economically ill. We're just, I guess, less economically ill than others, perhaps. That's what they're thinking.
  • nem0, on 03/03/2009, -15/+51US Dollars are GREAT! Just ask the Federal Reserve to print you up a few billion. You don't need to back them with any collateral. Then you can loan out 90% of what you just printed, then sit back and watch the interest roll in!
  • iancgi, on 03/03/2009, -12/+47CNN is lying to you!
  • akchrs, on 03/03/2009, -10/+39The economy is tanking and we are sliding into the worst depression ever, but in other news, Michelle Obama wears a sleeveless dress.
  • rolf, on 03/03/2009, -10/+31Pride goeth before a fall. Money is like any other commodity, there is supply and demand. I think the reason greenbacks are up are because there is a credit crises in the US and the flow of cash is slowed down. However, the Fed has pumped up the supply so much (70% more than there was previously), that the inflation is inevitable. Actually, the inflation of the money supply has already happened, but until the banks release the cash into the market, it's effects won't be felt. Mr. Beck explains it better with the housing chart and an inconvenient debt:
    http://www.youtube.com/watch?v=FgJYCpRr5yI
    http://www.youtube.com/watch?v=VUOAZaiiXXc
  • soomprimal, on 03/03/2009, -0/+20Apparently people don't believe this is what really happens. I dugg you up for reminding us about fractional reserve lending. Look it up, people.
  • inactive, on 03/03/2009, -13/+31There should be a bit more on the title, something along the lines of "for the time being".

    With how volatile the markets are now, there really is no telling what the secure currency will be. Mind you the last 2 months have been just about the worst in the U.S. market's history. I personally think that the U.S. is at the greatest risk of losing it's currency's value, I just don't think we've been in this long enough for it to drop. Only time will tell, so for now I just sit back and enjoy the show.
  • dazparkour, on 03/03/2009, -6/+23Other countries bought into the US Economy. That's what happens when you trade with people - their ***** is your *****.
  • davecachia, on 03/03/2009, -0/+17I thought the same thing when I invested 2 months ago.
  • inactive, on 03/03/2009, -1/+16 Which is the whole damn problem. They are all owned by the same families too. Watch how cable news will talk about every conceivable part of the problem but never will they question the Fed and fiat money.
  • BotchaMcCoola, on 03/03/2009, -5/+20Nice try but nowhere near that simple. The politicians are throwing hundreds of billions around like confetti. That devalues the dollar and promotes inflation. But meanwhile the citizens are not spending but saving it as though it is very valuable. Too early to tell which side will win.
  • soomprimal, on 03/03/2009, -13/+27Thanks- that was good for a laugh. Lots of optimism in that article and in the comment section. People just want whatever blankie or baba they can get, nice of CNN to give them one. The rest of us are preparing for a huge shift in the way the economic world works and bracing for a coming depression.
  • arunforce, on 03/03/2009, -7/+21The irony of your statement has been shown in the recent stock crash. A lot of countries got hit harder only because the US got hit.

    So basically you are saying you are hoping for a global depression.

    Dumb *****.
  • poidh, on 03/03/2009, -2/+15I'm European, but I'd prefer to see a stronger USA than a stronger EU.
    This is because even if Europe was strong, it would still be spineless. We are terminally infected with political correctness, cowardice and defeatism. We don't even have enough spine to defend our own cultures, rights and freedom of speech.
  • MarkusDee, on 03/03/2009, -0/+12China doesn't want the U.S. to tank though because then all that debt would be worthless. I think China has almost as much interest in seeing America get out of this predicament,
  • inactive, on 03/03/2009, -6/+17Because they can no longer find gold to buy?
  • dieboldcracy, on 03/03/2009, -0/+11when the bond market collapses this year, this article will be laughable
  • pstroll, on 03/03/2009, -2/+13Because most debts are denominated in dollars. If you were overleveraged and need to raise cash to pay debts you sell assets (see crashing stock and real estate markets), and accumulate dollars.
  • glitchbit, on 03/03/2009, -2/+12Nah Duh, United Kingdom is 370%+ in debt over their GDP and we are only 99% in debt of our entire GDP... so yea we are not as screwed up as the UK however Japan is only 34% in debt of an entire years worth of their own GDP so how/why Japan would be last to recover is a mystery to me. I think CNN knows nothing about how the economies work.
  • glinsvad, on 03/03/2009, -4/+14Not all Europeans are French.
  • SwiftKick34, on 03/03/2009, -0/+9Inflation obviously wins. Once the economy improves, all of that generated currency being saved by citizens will flood the market and inflate the currency.
  • atomicpoet, on 03/02/2009, -11/+20Oh, the irony...
  • phpld, on 03/03/2009, -1/+10If the US is lucky enough to emerge strong again (compared to the rest of the World), I sure hope people will realize how lucky they have been, and take steps to make sure this does not happen again any time soon.
  • LocalDocal, on 03/03/2009, -3/+12Irony? Let me give you some advice: Don't use Digg exclusively to get news. Diversify your sources.

    I'm guessing using Digg exclusively is why you think this is ironic considering the sheer number of people on Digg 'wittily' remarking how the dollar is/will be worthless in however many year(s).
  • marcov8, on 03/03/2009, -2/+10Thanks to China
  • poidh, on 03/03/2009, -2/+10@shdwfx

    It appears that you are talking out of your arse.

    Europe is spineless - we prefer "strongly worded letters", "exploring root causes", "sensitivity" when in conflict rather that "this is how it is. Either give in or we kick your ass".

    Political correctness - no one is allowed to talk about race issues. No one is allowed to talk [publicly] about immigration unless they want to be called racist and even arrested. No one is allowed to say that one culture is superior to another. No one is allowed to criticise Islam. You have to constantly watch what you say. You cannot make a joke for fear of offending someone. And so on and so on and so on.

    Cowardice and defeatism - We resign ourselves to being overwhelmed by our Muslim immigrants. We do not have the balls to fight - we let the USA do the work and at best we send a token force. We will not confront the traitors within our countries.

    Defend our cultures - Immigrants in the US "integrate" far better than those in the EU. Immigrants in the EU face no request to reliquish their inferior culture for the culture of the state which adopts them. We have Muslim ghettos, no-go areas, immigrants who live their entire lives without having to learn the host language, our own parades are banned whilst all around us Mosques spring up. And so on and so on.

    I'm not saying the US doesn't have problems, but theirs are less severe than our own, due to the European stupidity.
  • davecachia, on 03/03/2009, -3/+11Domino effect?
  • drowningfish, on 03/03/2009, -0/+8JimSwarthow -

    We exported bad paper (mortages). Hence we exported the problem globally. Greed consumed Investors which in turn consumed the world.
  • Calamier, on 03/03/2009, -0/+7The problem with your "cashing out" theory is that china couldn't possibly "cash out" on anything, they would merely stop crediting and exporting high-dollar goods to us, and then their chances of getting ANYTHING back within the next 20 years would be significantly lower.

    China is in this just as badly as we are if not worse because their payoff has to come after ours. Their position in our dilemma is much like an Investor who has a lot of credit riding on a failing company.
  • venomoushealer, on 03/03/2009, -0/+7Fixing the economy:
    Step 1) Create a small band of dedicated believers by encompassing morals and attitudes that are impressionable and attractive.
    Step 2) Spread nationwide and become known in the government as a terrorist organization.
    Step 3) Destroy banks and credit unions and records of any monetary accounts and transactions with obscene amounts of explosives.
    Step 4) Change your name to Brad Pitt and call your story "Fight Club."
  • Benjigga, on 03/03/2009, -0/+7Do us a favor and leave your house 3 minutes later than you normally would have today. That should make perfect timing for your head to smash into the bus that won't see you as you step off the curb.
  • dazparkour, on 03/03/2009, -1/+8You know, if the government controlled everything, they'd have followed you right back to your house.
  • m3arvk, on 03/03/2009, -0/+7Did it ever occur to you guys that the dollar isn't strong at all but just going through a DEFLATIONARY period due to the all the bad mortgage loans?

    In our financial system money is created out of thin air when it is loaned. What does that mean for the value of the dollar? The more loans taken out the more money is in circulation. When those loans go bad the money is removed from the monetary supply. More dollars means inflation and less dollars means deflation.

    The dollar isn't strong it's just being rapidly deflated. Once things settle it will go back to a strong inflationary trend.

    I don't have anything more appropriate than this chart but you can clearly see the inflation spike here: http://www.shadowstats.com/charts_republish#m3
  • toxicpiano, on 03/03/2009, -4/+10Which part?
  • Elranzer, on 03/03/2009, -2/+8Are you referring to how Muslim immigrants are basically taking over your countries, ignoring your cultures and slowly transforming it into North Saudi Arabia?
  • inactive, on 03/03/2009, -2/+8..As usual
  • whorunbartertwn, on 03/03/2009, -2/+8I bet if I drop a five dollar bill at your feet you reach down to snap it up.
  • dwalker, on 03/03/2009, -1/+7AND the source of your comment????

    Or is that just piffle?
  • jivatmanx, on 03/03/2009, -4/+10Sort of, but It's more because we've got bigger and more tanks and missiles than everyone else.

    Oh, and the E.U. is hardly a strong, uniform political entity comparable to the U.S.
  • Diggity75, on 03/03/2009, -0/+6So it must be right, Disco?

    "All my friends are jumping off of bridges, dad?" <- you're that kid, aren't you!
  • gtluke, on 03/03/2009, -2/+8It's not so much that our money is so sound. It's that everyone else has even less sound money.
  • thrashertm, on 03/03/2009, -2/+8Ron Paul does not advocate switching to the gold standard. He advocates for the legalization of competing currencies - allowing people to choose to use sound money instead of the fiat garbage the government prints up.
  • govsucks, on 03/03/2009, -0/+5But what about the Euro and the security of its highly regulated market?
    /s
  • Samueul, on 03/03/2009, -1/+6Step away from your keyboard, remove your tinfoil hat, get up, walk to the stairway of the basement you are in, slowly creep upstairs, head for the door, open it slowly, and take a walk outside......
  • inactive, on 03/03/2009, -3/+8 What steps can we take? Rothschild and Co. are still running the show so the beat will go on.
  • whorunbartertwn, on 03/03/2009, -0/+5>I think that there is a 50% chance that the dollar will be dead within 4 years.<

    I'll take any wager you offer on that, with my position that the dollar will be here in four years, and you can pick the currency.
  • poidh, on 03/03/2009, -2/+7@shdwfx

    More arse from you.

    Apparently, if I complain about people who like to subjugate infidels, disregard the laws of the land and keep women as cattle, it is because I am frustrated about my own life!

    Whereas immigrants allowed into the US are encouraged to "live the American dream" (a dream which now sees a half American, half Kenyan president), in Europe immigrants are encouraged not to change a single thing about themselves. Instead, they get given whichever resources they need to continue to live their dark ages cultures. Got more than one wife? No problem, here's some money. Want to pray all day instead of work? No problem, here's some money. Want to segregate yourself away from all the natives so that you don't have to learn the host language? No problem, here's some money. And a house. And an interpreter.
  • insanebrain, on 03/03/2009, -1/+6what's new(s)
  • Calamier, on 03/03/2009, -2/+7all of them.
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