The Daily Paul has been archived. Please see the continuation of the Daily Paul at Popular

Thank you for a great ride, and for 8 years of support!

Comment: My point is that when you

(See in situ)

In reply to comment: john2k (see in situ)

My point is that when you

My point is that when you price something in dollars and the dollar crashes then everything priced in dollars skyrockets in price relative to the significance of the dollar crash.

Price and value are not the same thing, so it is not an increase in value but only price.

The foreign currency "appreciation" you refer to is not value increasing, it's price denominated in dollars which is increasing. And that happens because of the dollar's diminished capacity to store & transfer value in transactions.

"other currencies that would have to automatically appreciate as a result"

All else being equal (with regards to other factors such as supply/demand impacting prices), anything priced in a depreciating currency rises in price when denominated in that same depreciating currency. It has to, because the before and after prices are both in terms of the currency which depreciated.

The appreciation you are referring to is price appreciation, not value appreciation.

It always has to be priced in something

The dollar is always priced in something. When you price anything in dollars at the same time you are pricing dollars in that thing. For example, if a gallon of milk is equivalent in value to 4 dollars then that also means 1 dollar is equivalent in value to 1/4 gallon of milk. Or if you like gold, right now a single dollar is equal in value to 1/1290th of an ounce of gold (when pricing dollars in gold).

Again, the dollar can't got to zero. It's impossible.

Did you know that two objects which get closer and closer together until you can see them touching can be mathematically represented to never touch? That's because the fractions representing their distance apart can be made infinitely smaller. But when you look at the objects you know they are touching, despite what the math shows.

It's the same with a crashed currency. The fractional value can become infinitely smaller while never actually hitting zero. But sooner or later the people realize it's no longer worth anything.