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CLSA's Chris Wood "In Five Years The US Dollar Paper Standard Will Collapse"
Chris Wood, who publishes the famous Fear and Greed newsletter, which Zero Hedge has republished on many occasions in the past (and whose latest edition can be found here), has some very scary things to say about the dollar in his interview by the CNBC lunch brigade. While Wood is still optimistic on Asia, and specifically China, due to lack of deflation in the region (for now), and expects an appreciation of the yuan soon, he is about as pessimistic on the dollar and "developed" economies as they come.
My view is that there is an inevitable endgame as a result of all this massive spending of taxpayer money in the West and Japan to bail out bankrupt banking systems, so in my view unfortunately the end game will be systemic government debt crisis in the western world. It will probably happen in Europe and will climax in the US, and i am expecting on a five year view the collapse of the US Dollar paper standard...The key reason why that is the endgame is that this credit crisis we
saw in the west in 2008 and 2009 has simply been deferred, because 95%
of the so-called government policy solutions to deal with this crisis
have simply been to extend government guarantees. So the problem has
been transferreWd from the private sector to the public sector. It is just a matter of time before investors revolt against these sovereign guarantees...The crisis is going to happen first in Europe, the US will be the endgame.
Wood is more optimistic on Japan and its 200% debt/GDP as the bulk of the debt is held by Japanese investors, which is not a new topic and has been discussed previously by SocGen's Dylan Grice, who however comes to the opposite conclusion. And to be sure, Chris' optimism on China has recently met with some stern opposition, including some of the most respected hedge funds, who see a simmering crisis in the world's most populous country which will make all existing bubble seem tame in comparison.
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Five years? I can't see this shell game going on more than two years.
"The Market can remain irrational longer than you can remain solvent."
often said, but boy am I finding it true now, my shorts are killing me!!
Dont underestimate the people in power's ability to stay there.
And do not underestimate the power of these people to rapidly screw things up while touting that the collapse is years off. It might get put off but it's going to become really apparent this year that it's going to happen and nobody can stop it.
Indeed, the end is nearer than we think. There is so much deception and misinformation in our society it is difficult to get a clear picture of reality. I have a strong belief that the leaders of finance are running and scared witless. They are working hard to hide this from us, but there plans will be shortly revealed. The pride and arrogance of the elite is beyond belief.
I disagree. Those in power are not scared out of their wits. They're trying to keep the game going a little longer so they can build up their personal fortunes and set up their escape plans. You would only be scared if you cared about the outcome. I think most of the powers-that-be are planning to profit from the outcome.
Given all the politicians "retiring", I would say the rats are jumping ship
i also disagree. i saw the subprime collapse coming years before , and month aftermonth i was wondering 'why hasnt this shit collapsed yet?'
the oligarchs probably have a few more cards to deal in extend&pretend than the Fed Reserve's efforts alone
Number 2 guy at the Fed " retired " today....Fed Vice Chairman. And BB's good buddy and swami.
One rat jumps the sinking ship and the rest follow. We'll see.
Make sure the captain isn't on one of the lifeboats - it's against the rules.
Consider the risk that if things fall off and shorts are set to make tons of money, it will happen at the same time at which there are no functioning banks or ATMs to remove your paper bills from?
Or in a less severe case, that governments will totally muck up the ability to withdrawl funds earned on shorts, requiring a clawback period, high tax, or other?
And that's the fundamental problem with being short in a disintegrating market. It's like having an insurance policy, but everyone's house burns down at once, and the insurance company goes bankrupt. You might say "pay off my short" and the counterparty might say "too bad, so sad, no money left".
When you short the security, you get cash and owe a security. When everything falls apart, you already have the cash in hand, you just need to repay the security which is now worth nothing, thus, cost you nothing to repay.
Then change your underwear.
RE:"The Market can remain irrational longer than you can remain solvent."
Should be rephrased as Keynes knew that "Markets can remain manipulated longer than you can remain solvent." Via secretive central banking.
That was my thought as well.
I guess there are a few more tricks we have yet to see or imagine?
Interesting. Thats about the time the New World Currency is suppose to debut.
It will make it easier for the nations to make do on their future war repirations.
If you want to know what cities will be blown up, just follow the CDO market, and insurance products, on those towers and business's in targeted cities.
Poor Obama, the ultimate revenge of the south is upon him.
The Drudge report today noting Obama drinking habit. It must be rough on the dude.
Inspector Asset
WallSTOnion.blogspot.com
Let O'Bummer feel the stress like we (I) do.
(He wrote while pouring vat of Scotch....)
Everybody! Quick focusing on Obama as though he has any relevancy.
+10
Never underestimate the power of denial and the capacity of the average person to manufacture denial. It's more addictive than heroin and you make it yourself for free. Unlimited supply usually means total addiction.
Hopium
Why are the bozos always ballooning as soon as "collapse of the dollar" is mentioned. I mean PLZ, even retard understands this "endgame".
Because they are about to be whipped by management for letting Chris Wood get any airtime.
But his hair looks so nice...
Ah, but of course, a buying opportunity. Always. He looks like a hippy caught in the headlights, but I will say he's pretty good with a teleprompter. I especially like the darting eyes and the stylish scripting.
I've had enough of video ads. No mas, por favor.
I agree. This is not even news anymore. Wonder if he thinks he is being bold with this prediction?
I love your Tweet: "Chris Wood never being invited back to CNBC again." LOL!
Dude--We hear ya, but it is hard to take anyone who looks like an Oompa Loompa seriously.
2 words---HAIR CUT.
Why not just listen to what he says instead of debating in your mind whether you want to go to bed with him? Personally, I couldn't care less about the man's hair.
I love his George Washington hair. Or is he the Sphinx?
A spoon full of sugar helps the medicine go down in the most delightful way :D
His hair is distracting the listeners from the message.
Five years sounds very optimistic but three card monty can be played as long as there are suckers ready to pay.
It's carrot top's dad.
notice all those commentators are in such disbelief and freaking out. that's very telling to me.
well his hair is fine .. its the mouths that need a clip..
ok...BTW, is it dumpster or cumdumpster?
etf ,, the merkin .. with a mouth of a 5 year old ,, living with mother
he is a bit much. It happens when we are insecure about using daddys computer to mess with the big boys and see if you can piss them off. He is best off ignored.
mouths that need a clip ergo The ETF guy
7 flags as junk on his hair is okay,,but the etf guy is okay.// what are you guy smoking
Everyone is still in denial about what he is trying to say. They would rather live in denial and be in bliss than face reality and be depressed.
yeah, just like merehuman would rather stuff dick in his mouth all day while calling everyone else gay, rather than look at robo's pic's.
Master Bates, I presume?
are you going to spam all over the website?
ETF-Trader=dickweed loser
ETF-Trader=dickweed loser=potty mouthed masterbates= low class merkin in shabby hotel
ETF-Trader, Do you have anything intelligent to add to any thread on this website?
how do ETF-Trader's comments even get past the moderator on this website? Marla? Tyler?
is ZH going to let this dimwit ruin every thread he/she posts on?
Guy gets cut off before he finishes a single thought or sentence by argumentative pin heads. I guess the other 55 minutes of the hour the hosts get isn't enough...feel the need to shout 'em down and dismiss their guests.
No wonder their ratings suck...they just can't stand to even acknowledge the coin has two sides.
Cornelius Vanderbilt was known to refuse to speak again in a meeting if he was interrupted. It seems to be a policy that served him.
To my guess, the argumentative pin heads, as you call them, when they receive this kind of guests, earn the most of their pay check during these 5 minutes than during the 55 other minutes.
They might have earned a pay increase on that show.
He sounds like he just hit the bong.....
What is the difference between "defer" and "postpone"?
It's hard to imagine that we could even last 5 years! Foreigners will eventually circumvent the dollar. In the past it was mutually beneficial, but now the world is realigning. Let the debt crisis begin. . .
LEARN THE TRUTH ABOUT OIL, US MILITARY AND THE SUBURBS:
http://www.youtube.com/watch?v=MfGZ1MWRNxU
It's difficult to differentiate the children in the video from the children
posting. Their remarks are equally useless.
Amen. The decline of Zero Hedge is a leading indicator.
Agreed, not a site I can promote whatsoever.
Boy this clip has the CNBC All Star Fuckwid team all wired up at once!
Its just sewage. Raw fucking sewage.
It is impossible to explain complex ideas to idiots if they all keep interrupting.
"The US has the most stable government in the world."
and the Titanic had the most stable crew in the world....
Saying five years is just like saying "n" years. Some number, whatever.
Wanting it to happen doesn't make it happen faster. I am starting to believe they'll just pass some laws resetting the debt and just keep going. There needs to be a stable alternative and right now I don't see it. To fail this system would have to be unable to provide a means to trade for basics like food and gasoline before people will abandon it.
All that is needed for the system to fail is for people to have an expectation that the longer they hold their USD the less it is worth. That belief starts the inflation spiral. You will still get paid in USD, buy things in USD, but you won't want to hold wealth in USD. And that's the end.
agree. where will all that cash go? Bazillions of dollars worth of crap will get sold and go somewhere. As an interim, maybe Japan....maybe better there than China where there are still no basics like rule of law, property ownership etc. to speak of. The US Govt has a chance now to blow the best game ever pushed on so many people at once on the planet....to trade in dollars! Pathetic.
Inflate or Die!
right now the idea seems to be that since everybody (country-wise) is so scared of economic collapse they will just ignore the catastrophic problems looming and print/indebt as much as is possible and hope for no sort of tipping point event. They will also spin all the blabber about recovery and extend everything that can be extended to keep the proles from rioting. So far it has worked from 2008 up to now.. not sure what will be the 'black swan' though
The end was cut off too..the chick says something like.."wow,what a money under the matress interview that was"..classic
pure poppycock
How the hell does Beaker still have a job at MSNBC? Everyone knows that the US is the end game because of the reserve currency. Everyone knows that when things hit the fan in Europe people move into the US dollar - it doesn't mean that the US dollar is strong. Why is he still asking these kinds of questions?
Looks like MSNBC will be next---one at a time.
http://latimesblogs.latimes.com/entertainmentnewsbuzz/2010/02/abc-news-to-cut-half-its-domestic-correspondents-shut-down-all-bureaus-except-washington.html
The irony is that the LA Times, a bankrupt newspaper (along with the Chicago Tribune and some other choice fish wraps), is reporting on cut-backs in the broadcast media.
CNBC Commentators: All hired actors who's script is writen prior to hire. Stray from the script and you get to renew your contract with Fox.
Where is Charlie Gasparino?
No, no, no! Who the hell screwed up at CNBC? If I wanted reality, I'd read ZH......
Gold, Asian and Emerging markets was his hype but WHEN??? We have many roads to travel in 5 years.
Hair, hair....
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I want to encourage you to keep posting this. We need to wake up.
He sounds like Peter Schiff buy gold, buy Asia and dollar collapse in the future.
is he related to andre the giant?
To me, Paulsons shaved head was the most offensive part of this bailout. The guy looks like some alien from Planet XYZ- and we had to view it on a daily basis. For heavan sakes, put a wig on it; hes got the money so he can afford one.
DC March will not help !! We are a country of numskulls and imbeciles !! Consumer spending rising faster than incomes - thats a sure tell what the consumer thinks of the recovery. Must think we are all in wonderland all over again.
To put this in perspective, this would be like believing that we would see the end of the world when the debt clock could no longer count the national debt - they just added another digit. Adapt the game to suit if you have control of the social structure when the way forward becomes difficult. The US has everything it needs except rare earth metals and oil. But the game is not just nation against nation, central banks are collectively conspiring against nations (Toxic CDOs) for the World Bank, IMF, and BIS.
One of the best articles I have read in a long time on the big picture and the transition. I highly recommend it:
Crashing Towards a New Social Order: http://www.marketoracle.co.uk/Article17568.html
Only halfway through it, but must thank you for the link. The author's relentlessly rational yet unpressured progress in his analysis is quite different from what I've come to expect from the "NWO" crowd (which, though I expect this piece to lead there, may prove to be a misattribution on my part.)
In any case, thanks for the link.
Nice to see you post AN. Always enjoy your commentary.
I think comments like this undermine the credibility of the article:
"China and Russia would like to see a stable, multi-polar world; it is only our elite bankers who are obsessed with world domination."
Perhaps an oversimplification, perhaps a reflection of where geopolitical "evolution" has led us/them.
Both good comments. Thought provoking. This is an old argument: Structure vs. Agency. This article overtly attributes a great deal to multi-generational agents (why I have trouble with the NWO stuff). It could still be pretty accurate, but be more a product of structure/evolution presenting individual agents with choices that look "natural" to them, but viewed through the macro lens, are in fact a product that is more out of their hands than we would suppose. Another way to say this is the players are replicating their evolving cultures more than they are studying for, planning, and executing a big conspiracy.
Good article. The author has an overview that is impressive at first glance. A few of the things he found and labeled as precursors to his predictions were grasps at straws, but the over all map was compelling.
My thoughts exactly (including the "agency" issue, which tends to smack of an operationally unecessary paranoia . . . I hope!)
"Five years or two years--or some other single-digit drop-dead interval, what the heart of the matter is, is that it is now a game of musical chairs in which there will be one chair; i.e., when it happens, it's going to collapse overnight...
his voice sounds like that of the actor who imitated cary grant (called 'gary granite') on the flintstones
I spat up blood at the statements made between 5:01 - 5:18. Just to be sure I heard correctly, I replayed several times over and then shat myself at the thought this guy still has a job and that people will actually believe what he says and use those statements as talking points when going off with their half-drunktard buddies to "talk smart money" with other people.
i had to listen to that argument a few times myself.
"the panic selling during a dollar collapse would cause a self-healing rush to buy the dollar."
yes, of course. btw, i really like the "spitting up blood" visual. i'm going to find a way to use that at least five times at work tomorrow. thanks.
This monetarist madness must end now - this capital is unproductive at the moment and when/if banks release these reserves they will fuel further malinvestment in consumer sectors that do not increase the capacity of economies to generate true wealth.
Massive fiscal spending on long term structural projects will increase price inflation also but will provide some wage inflation to counter the inevitable.
After a decade of this necessary investment in will provide a baseline of infrastructure that will sustain at least some wealth for the long term
Love the George Washington look
If this takes 5 years to blow up I will be mad with glee and joy. I'm praying it's not within 2 years! Every year is another year I can get ready for whatever fallout happens, and being a dumb kid it's not like I was really sitting around with a lot of resources to prepare.
A new hairstyle wouldn't kill him.
Don't worry folks, the dollar is "self healing"
These interviewers remind me of the Skoobidoo show.
why not now? Instead of 5 years later.
Shit, Dennis Kneel still has a job? I thought he was sucking cock for tens in Harlem!
So if there's to be a dollar crisis, what will China do with all those dollar reserves?
I guess they could use all those FRNs to insulate their homes against the coming Ice Age - oh shit those dollars are in the form of electrons so they are going to have to find something else to keep warm - cow dung comes to mind
First Greece..followed by Spain...and in the end the US? Hmmm...sounds like the Titanic as passenger run from one sinking part of the ship to the next safest spot. Eventually thebship completely submerges. Thos in the life boats survive...BUY GOLD!
visit my blog ITX STOCK CHARTZ http://itzstockchartz.blogspot.com
For my mind the global economy could plod along on manipulated & inflated tenderhooks indefinately but at some stage the intervention of a "trigger event" will bring the reality of the situation into the inescapable foreground.
like the GFC, the economy was obviously sick and wounded for anyone who cared to look but it took the trigger event of lehmans to make it real.
perhaps it'll be 5 years until the USD collapses but im certain it wont be that long till equity and credit markets start crumbling.... just waiting on that trigger.
Matt
Perhaps someone a lot smarter than me can explain why so many folks downplay Japan's massive federal debt because "95% if held by domestic investors". I can understand if a country's debt is external and in a currency other than the home currency, but how is Japan better off than the US, where 100% of the debt is held by terrestrial investors, and like the yen, all of it is in the currency which the US retains the right---and exercises it regularly---to print the currency?
In addition, in a pinch the US has the nuclear option, that is, default on non-domestic held Treasury paper.
Chris woods in 2007 said that gold would be $3,400 oz. in 3 yrs. well there is still time but these guys are usually early on their calls. The problem is applying logic to the markets when they operate more on confidence, and hype which increases confidence.
his hair speaks the truth.. as for dollar collapse, the debt will collapse first, then the dollar on the computer screens. then my dog will look at me in the "I saw this shit coming" kind of way that he does. What? Are the majority of people stupider than my dog? Yes, and he's an Austrian monetarist too AND shits in the garden.
You'll know things are turning up when Dennis Knele's body is twisting in the wind at CNBC headquarters at the end of a rope. What a douchebag he is.
U.S Economic Leadership: One bad decision stacked on top of another. This one to support paper assets that are still historically overpriced. No free lunch in the end.
they resigned in order to spend more time with their families.
comparisons to the titanic are valid due to premeditated malevolence, not any sort of accident or incompetence. shucks we're just in uncharted territory and don't know what we're doing. the sheeple buy it every time.
http://www.world-mysteries.com/doug_titanic1.htm
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