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The US Dollar is MAJOR Trouble

Phoenix Capital Research's picture




 

Earlier
today I wrote a piece forecasting the end of the Euro. At that time, I speculated
that the Euro would be broken up within the next year.

 

Then I
looked at the US Dollar’s chart.

 

I've said
before that the US Dollar was in BIG trouble... but as of tonight, it's on
DEFCON 1 RED ALERT TROUBLE.

 

As the below
chart shows, the greenback needs to rally and rally hard if we’re not going to
head into a SERIOUS collapse shortly.

 

 

What you're
looking at is the US Dollar right on its multi-year trendline. If we take this
out now, then we are heading into an inflationary death spiral in very short
order.

 

Indeed, once
we take out this line, we're just a few ticks away from triggering the MASSIVE
Head and Shoulders pattern the greenback has formed over the last 20 years.

 

 

In case
you're wondering, this pattern has an ultimate target of 40... a full 50% lower
than where the US Dollar is today.

 

We're
talking about hyper-inflation on an order that would make Weimar Germany proud.
And if we break the green line above, we're THAT much closer to this becoming a
reality.

 

In plain
terms, the end game is fast approaching if not already here. I've long thought
the US Dollar had one last rally in it, but looking at the charts tonight I
could very likely be wrong.

 

Indeed,
inflation is already exploding worldwide, which means paper money in general is
going to be worth less and less on its way to worthless.

 

If you think
the US is immune to this situation, you're in for a very RUDE surprise in the
coming months. Indeed, the Fed’s Hoenic just announced there might even be QE 3…
and he’s supposed to be one of the Fed HAWKS!  

 

The writing
on the wall is clear: the Fed will stop at nothing to destroy the US Dollar in
order to prop up the Big Banks. The 308 million of us who don’t work on Wall
Street are all going to be thrown under the bus. Don’t let it happen. Take
steps now to prepare yourself for what’s to come.

 

Good
Investing!

 

Graham
Summers

 

PS. If
you’ve yet to take steps to prepare your portfolio for the coming inflationary disaster,
our FREE Special Report, The Inflationary
Holocaust
explains not only why inflation is here now, why the Fed is
powerless to stop it, and three investments that absolutely EXPLODE as a result
of this.

 

All in all
its 14 pages contain a literal treasure trove of information on how to take
steps to prepare AND profit from what’s to come. And it’s all 100% FREE.

 

To pick up
your copy today, got to http://www.gainspainscapital.com
and click on FREE REPORTS.

 

 

 

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Wed, 02/02/2011 - 23:00 | 929765 dxj
dxj's picture

You're cumming too early, said your girlfriend.

Step back, it's a wedge. We'll be bouncing off 85 before we break 71.

http://research.stlouisfed.org/fred2/series/DTWEXM?cid=105

Wed, 02/02/2011 - 13:02 | 927750 sunnydays
sunnydays's picture

I guess the day is now here.  They kicked the can and the wall is looming.  It is going to be so bad for those who have hidden their heads in the sand and not acknowledging the U.S. was/is really going down.

Wed, 02/02/2011 - 10:34 | 927079 falak pema
falak pema's picture

Your scenario does NOT help Wall street. Period. Game over.

Wed, 02/02/2011 - 10:34 | 927078 falak pema
falak pema's picture

Your scenario does NOT help Wall street. Period. Game over.

Wed, 02/02/2011 - 10:21 | 927005 Sathington Willougby
Sathington Willougby's picture

This is like reading tea leaves while the fields get salted.

Sure the pattern looks bad, but the fundamental observations make that look like Shirley Temple.

"only an extremely disciplined mind can engage in free thinking" - Mother Nature

 

Wed, 02/02/2011 - 10:08 | 926966 sgorem
sgorem's picture

same here.............

Wed, 02/02/2011 - 09:59 | 926945 falak pema
falak pema's picture

@mouser98 : read my analysis. The great hatchery scheme of Benbarnification has no idea how to get out of the stranglehold. Damned if you do, damned if you don't. When world state FED thieves fall out... its no rules, no holds barred, every man for himself, and may the devil take the hindmost... That's all you need to know. The rest is literature on Wall street...paper money like falling leaves in autumn...Enjoy the rain while it lasts!

Wed, 02/02/2011 - 11:03 | 927196 eddiebe
eddiebe's picture

What makes you think Ben wants to get out of the stranglehold?

 These people are in complete control. It's managed, including the stranglehold.

 The only stranglehold they will ever not be able to get out of is a noose around their neck, and that won't happen as long as enough assholes buy into their bullshit and take their greenbacks in their employ.

Wed, 02/02/2011 - 10:29 | 927049 mouser98
mouser98's picture

ultimately, the Bernanke interests do not lie with the political class, he works for bankers.  he is not in a damned if you do, damned if you don't position.  they are setting this up, you just watch.

consider the results for the banks under the scenario i am describing.  they are flush with reserves of newly printed dollars given to them freely by Congress and by the Fed.  right now, those dollars really are not worth all that much but what happens if interest rates rise?  all of their debtors will be put in a bind, especially governments, as interest payments increase while the economy, and in turn, tax revenues, remain flat (at best).  and we know what happens when a government cannot make its interest payments, they renegotiate a new deal that attaches the labor of another three or four future generations.  meanwhile, those reserves that they got for free become economic sledgehammers.  they are probably counting on the Chinese to unload dollars so they can grab them up now while they are cheap.  

this would make the great robberies of 2008 look like a convenience store hold-up.

Wed, 02/02/2011 - 09:52 | 926916 Hannibal
Hannibal's picture

Yep, ...Still buying physical gold and silver.

Wed, 02/02/2011 - 09:38 | 926872 mouser98
mouser98's picture

it can go two ways: hyperinflation or deflation.  right now, the Bernanke is inflating but he still has room before it becomes hyperinflation.  and its not in the interest of Bernanke's stringpullers to hyperinflate.  the vast majority of assets on the big banks' balance sheets are USD denominated debt.  in a hyperinflation scenario, that debt becomes worthless, the bankers lose, unless they manage to sell it to a bigger fool before liftoff.

the politicians favor hyperinflation over the alternative, which involves a lot of stretched political necks due to massive foreclosures as debtors cannot make interest payments if dollars start becoming more scarce, but politicians do not control the printing presses, bankers do.

my guess is that Bernanke will be told to put on the brakes when the bankers have everything set up the way they want it, the question is, what is it they are setting up?  are they loading up on reserves so that when they pull the brakes, they can buy up everything for pennies on the dollar with their newly superpowered dollars?  are they waiting for a new administration to take power?  whoever is sitting in the big chair when this SHTF will be the world's all time historical scapegoat... are they waiting for the US to elect a Libertarian, in order to permanently discredit forever the "free market"?  all of the above?

or am i missing something?

Wed, 02/02/2011 - 10:38 | 927039 Gargamel
Gargamel's picture

both roads lead to hyperinflation.  

If...and they won't,  they put the brakes on the US would not be able to meet it's obligations.   This would cause rates to rise and close the noose. The debt bubble would finally blow up and we would get to see what systemic really means.

deflation...leads to.  hyperinflation.  The math doesn't work.  so either way we are are upshits creek.

Wed, 02/02/2011 - 10:41 | 927111 mouser98
mouser98's picture

ultimately, what do the bankers care if the US cannot meet it's obligations?  these people are international, they own most of the world, and a fair amount of the future.  to make an omelet, you gotta break some eggs.  a default by the US would likely end up with us in receivership to the IMF...  pretty sweet deal if you own the IMF.

Wed, 02/02/2011 - 10:46 | 927128 Gargamel
Gargamel's picture

100% agreed.   These people don't have a nationality.  They are elite globalists.  but if you hold dollars you are screwed.    I just hope that instead of becoming part of a one world government the people simply default on their debt, allow for real money, and start over.  Tell the giant banks to take a hike.

Wed, 02/02/2011 - 10:21 | 927008 eddiebe
eddiebe's picture

Here is what I think you are missing:

 Gold/Silver will be allowed to rise along with bond yields. At the same time they will manage currencies lower. When the bond yields and gold price suits the bankers ( and the dollar is low enough and everyone is chasing gold and bond yields with their inflated dollars), they will link the dollar to gold, and buy back the gold and the bond form the public that now can't get enough of the strong dollar.

Epuities and commodities are and will be a hedge for falling currencies until they turn around, which won't happen until the above scenario unfolds. 

Wed, 02/02/2011 - 09:26 | 926838 lascu.roman
lascu.roman's picture

the chinese will buy the dollar by then, they can't afford very expensive food/oil, neither a worthless dollar.

Wed, 02/02/2011 - 09:21 | 926817 b_thunder
b_thunder's picture

"this pattern has an ultimate target of 40... a full 50% lower than where the US Dollar is today."

But  if dollar drops by 50%,  wouldn't that make Obummer's pledge of doubling exports a reality?  (in nominal terms of course, but who's counting)

And, another promise of the Messiah will have been fulfilled.  Mission Accomplished indeed.

 

Wed, 02/02/2011 - 10:36 | 927090 SheepDog-One
SheepDog-One's picture

What other things has Obama accomplished? His eugenics deathcare plan which is now being ruled unconstitutional all over the country?

Wed, 02/02/2011 - 08:48 | 926742 lascu.roman
lascu.roman's picture

Head and Shoulders pattern during the last 20 years? tell me that you don't believe in TA over a such long period...

even with a DXY at 40, what do you think people will use as a international currency? the euro? or maybe the yuan?

I can't follow your logic, it seems that the dollar weakness will trigger hyperinflation?

Wed, 02/02/2011 - 09:15 | 926796 All_Is_Well
All_Is_Well's picture

The real question is what will be the price of gold/silver, food, gas with a DXY of 40?

 

 

 

 

 

Wed, 02/02/2011 - 08:47 | 926741 Moonrajah
Moonrajah's picture

Did Mubarak Obama see those charts?

Wed, 02/02/2011 - 08:46 | 926740 pat53
pat53's picture

"I could very likely be wrong"  .... yeah, you've been pretty much wrong about everything !  LOL You must be related to "Rosie"  !!?

Wed, 02/02/2011 - 08:45 | 926737 blindfaith
blindfaith's picture

There is something we must be missing in all this. 

These financial supervisors are not complete imbeciles.  If the dollar or Euro is a train wreck so is their organization.  Unless 'the plan' is total and immediate destruction of the world financial systems by these same 'bankers' and replace 'money' with something else we know nothing about...it makes no sense for them to participate in driving the train off the cliff.

I have to wonder, as I have written here lately, if some unknown group(s) are trying to start a world war with commodities being the first shot.

We have got to be missing something.

Wed, 02/02/2011 - 10:25 | 927021 Gargamel
Gargamel's picture

Totally agreed.   It is their plan.  I am wondering if the internet was the wrench.

They have the IMF ready.  In fact the IMF is already selling bonds for the first time ever.

The question is....Will the world accept the SDR as a the reserve currency?

Has the internet disabled the MSM?   

Wed, 02/02/2011 - 09:17 | 926807 eddiebe
eddiebe's picture

Here is what we are ( or are not ) missing:

 The bankers and their lackeys simply want everything: All the money, all the gold, all the energy supplies, all the land, all the houses, all the food/ seed, all the water, and if they can figure out how, all the air we breathe. What did I miss?

 They will never stop. When they die, some other greedy power hungry psychopatic swine step into their place.

 That is what we are missing! Dollar strenghth or weekness are just part of the game to get them what they are after. ( see above)

Wed, 02/02/2011 - 10:35 | 927085 SheepDog-One
SheepDog-One's picture

Exactly...people need to realize what the actual plan is, to confiscate anything you have of true value, and usher in their cashless society and all that crap. Bulls problem is they assume Bernank and the rest of the world bankers are trying to HELP you and FIX economies to the useless eaters benefit? Its HILLARIOUS so many cant see the forest for the trees!

Wed, 02/02/2011 - 08:53 | 926746 cossack55
cossack55's picture

How about "cashless society".  Everyone has debit card thru JPM. PMs are confiscated/illegal to own (April 1933) and thus only have value on black market.  C-day instituted with 10% swap rate applied to your new SNAP card.  No cash = war on terror/drugs, easy to sell to the sheeple.TaDa.

Wed, 02/02/2011 - 08:31 | 926704 Gargamel
Gargamel's picture

Don't you think the central banks know where the trend lines are and buy each others currencies to keep the global ponzi going?  

Wed, 02/02/2011 - 08:45 | 926736 cossack55
cossack55's picture

WAD (without a doubt).

Wed, 02/02/2011 - 08:25 | 926701 falak pema
falak pema's picture

Graham Summers does a complete about turn. From EURO disrupt yesterday we are now in USD mega plunge scenario today. Well done the man from the moon whose head and shoulders are like those of the cow who jumped over that planet. Looks like the world is really ganging up against Uncle Sam's green back...or is it QE that is doing the trick...The oil spike looks ominous as lack of public transport on US continent will make it into a star trek without end. Deep deep trouble as the snow piles up! Hope the world deflates first, to stop the inflation bubble. But f it does then B B is in big trouble as the Dow falls to rock bottom. Damned if you do and damned if you don't...Hey Mister Tambourine man play a song for me...My guess is BOTH Euro and USD are in trouble...for a long time coming...How does it feel to be on your own...

 

Wed, 02/02/2011 - 08:44 | 926732 cossack55
cossack55's picture

Great.  All I want is no goobermint screwing up the few years I may have left.  I'll let the young deal with it.  I had no luck destroying the evil, I wish them the best.

Wed, 02/02/2011 - 08:02 | 926682 Buttcathead
Buttcathead's picture

 I dont care if the dollar crashes, I is aint gots none no ways.  When you aints got no money, everything is inflated even if it's on sale.  The Bernack done run over my family 3 or 4 times in his bus.  If it werent for Obama we wuds have no hope.

Wed, 02/02/2011 - 03:33 | 926557 Johnk
Johnk's picture

re: "PCE Core Inflation hit 0.0% just this week"

Please, tell me where you buy your groceries or gas. 

To be fair, I'm sure Mike Shedlock agrees that record high prices in just about everything except housing and pocket calculators does not constitute inflation.   No sirree bob.

This triumph of theory over reality is actually fascinating to watch.

Meanwhile, I'm going to go re-read "Dying of Money" by Jens O. Parsson.

 

 

 

Wed, 02/02/2011 - 03:43 | 926567 More Critical T...
More Critical Thinking Wanted's picture

 

Please, tell me where you buy your groceries or gas.

You need to read the full comment you reply to, not just the first sentence. The rest of my comment gave you a ready answer for your question, and I have specifically highlighted the key phrase for you:

See:


http://krugman.blogs.nytimes.com/2011/02/01/the-un-cola-era/


[*] core inflation is a metric that measures "hard to get rid of" types of inflation and it does not intend to track "cost of living" inflation. The latter is trending higher in the US currently, due to oil and other commodity price increases.


Wed, 02/02/2011 - 10:32 | 927068 SheepDog-One
SheepDog-One's picture

OH well as long as Krugman said it, its definitely true! Case closed, ramp up Krugmans printing press to full speed.

Sun, 02/06/2011 - 10:15 | 932212 More Critical T...
More Critical Thinking Wanted's picture

 

You can read up about the purpose of the core CPI metric on numerous other places, if you do not like Krugman explaining it to you.

 

Wed, 02/02/2011 - 01:46 | 926428 chump666
chump666's picture

dollar will be bid soon...the last rally (everything, except for the dollar and UST's) was ridiculous, rallying on just BP dividend news and ISM report. 

A major correction is due, so usd looks good for a little while.  if anything there will be a reversal on the EUR and commodity crosses

Wed, 02/02/2011 - 01:16 | 926381 AUD
AUD's picture

Looks like a bunch of lines & squiggles to me.

Wed, 02/02/2011 - 08:31 | 926707 El Hosel
El Hosel's picture

  "Everybody" knows the dollar is in trouble... Must be rally time. Trading range is 75 to 88, until its not. Dollar is well off the 2008 lows, hardly ever hear anybody mention that.

 

http://finviz.com/futures_charts.ashx?t=DX&p=w1

Wed, 02/02/2011 - 10:30 | 927059 SheepDog-One
SheepDog-One's picture

Well as long as we're better than that banner year 2008, we're good.

Wed, 02/02/2011 - 09:54 | 926925 4xaddict
4xaddict's picture

+1

Wed, 02/02/2011 - 00:58 | 926353 More Critical T...
More Critical Thinking Wanted's picture

...

Wed, 02/02/2011 - 00:47 | 926334 Mr Lennon Hendrix
Mr Lennon Hendrix's picture
The US Dollar is MAJOR Trouble

Agreed.

Wed, 02/02/2011 - 09:53 | 926922 4xaddict
4xaddict's picture

74 is the next key horizontal support level

Inflationary death spiral USD, EUR to collapse. The only currency is PMs and stuff you can eat.

There is no incentive for the wealthiest 1% to completely blow up the system. As long as the US is the last one to crash then the USD will be fine.

 

Wed, 02/02/2011 - 01:02 | 926355 More Critical T...
More Critical Thinking Wanted's picture

 

What you're looking at is the US Dollar right on its multi-year trendline. If we take this out now, then we are heading into an inflationary death spiral in very short order.

LOL!

An honest question: were you predicting an "inflationary death spiral" when the Bush administration brought the dollar index down by 60%, from 120 to 75? Do you have any links to those articles? :-)

 

So now after QE2 the dollar index is down from 80 to 75 and the end is nigh? :-)

 

I'll give a contrary prediction: the weaker dollar will help US exports and after hitting a 65-70 low after a risk-off stream-out of parked-in-the-USD safe funds a steadily improving US economy will eventually strengthen the dollar again. Maybe it will be like in the 90s, when under the Clinton administration the dollar strengthened from 80 to 120 ...

 

Wed, 02/02/2011 - 10:29 | 927030 SheepDog-One
SheepDog-One's picture

More Critical going on about 'exports'? Care to name some? The only US exports I can think of are inflation in weakening dollars, and jobs.

Wed, 02/02/2011 - 09:19 | 926813 TiredofIgnorance
TiredofIgnorance's picture

"The Clinton Administration"?  LMAO

 

BJ Bill didn't do ANYTHING, the Congress balanced the budget during a "techno Boom" created by the American private sector.

 

Got Blue Dress?

Wed, 02/02/2011 - 08:41 | 926727 Silversinner
Silversinner's picture

Us indeed boost exports not of goods but dollars.

Do you think this will be positive for the value of the dollar?!

'retorical question'

Wed, 02/02/2011 - 08:52 | 926749 More Critical T...
More Critical Thinking Wanted's picture

 

Could you please explain your point more clearly, and state a conclusion?

I made a clear claim, that what the article claims is at odds with history, is at odds with current facts and is at odds with logic.

Via what mechanism can you see an 'inflationary death' spiral occurring, and in what countries? US alone? Non-US countries? Is such USD induced inflation occurring today in your opinion and do you have hard data to show that?

 

Wed, 02/02/2011 - 11:23 | 927286 RockyRacoon
RockyRacoon's picture

Not fair picking on the cripples. 

Did "rhetorical question" not make sense to you?

Go back and reply to

Bartanist
on Wed, 02/02/2011 - 09:33
#927040

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