Comment: Why I am and have been dollar bullish

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Why I am and have been dollar bullish

Beeman, you asked why I am dollar bullish. Most don't understand what a dollar really is, but you hint at the answer.

The dollar represents the following:

Euro 57.6 %
Japan/yen 13.6 %
UK/pound 11.9 %
Canada/dollar 9.1 %
Sweden/krona 4.2 %
Switzerland/franc 3.6 %

I am negative on the top 2 of these based on the data which represent 71.2% of the dollar. The dollar is simply getting stronger because these currencies have countries where their goal is to weaken (Shinto and the Yen with the approval of the G20) their currency or have parts to it that are in deep trouble (Euro with the countries that can't separately print their way out of their troubles - Greece, Portugal, Italy, Spain). Germany can't support all of Europe.

The ECB's hands are tied.

Japan's debt is catching up to them as they produce less and less, now at a 14 year low.

This by no means we are doing well in the U.S. as our data isn't the best either, but when you have most of the world still believing in the U.S. dollar, then by default, it appreciates.

Those in Argentina are trying to exchange their pesos into dollars at a 30% discount and rising. The Brazilian Real has depreciated quickly. The dollar is still the standard around the world, so I don't discount it.

But all currencies, including the dollar, will lose purchasing power compared to gold in the long run. Silver too, and I am, like you, more bullish on silver than gold at present.

Dollar bullish
Gold bullish
Silver bullish

As the dollar appreciates along with gold and silver, you get the extra purchasing power that comes with it. But all currencies are on the titanic, running from one side of the ship to the other as they fight for lower value in trying to make their goods less expensive and drive up GDP. But the only lifeboats are made of gold (and silver).

Author of Buy Gold and Silver Safely
Next book: Illusions of Wealth - due out soon
Also writing book We the Serfs!