The USD Is Tumbling; Near 2 Month Lows

Tyler Durden's picture

Equities have flip-flopped this morning, giving up the new normal opening-squeeze higher gains as USDJPY fades. Bonds are rallying. But it is the USD Index that is the most notable this morning as it tumbles back towards 2-month lows in a hurry... This is the biggest 2-day plunge in 3 months.



Pushing the USD to 2-month lows...



Charts: Bloomberg

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Headbanger's picture

Yankee dalla go home!

But c'mon Tylers... It needs to break solidly below 79 or so for some real bad shit to happen:

Soul Glow's picture

Inflation is good for the economy because Bernanke said so.

Forward, Comrade!

lordylord's picture

On its way to ZERO. Not if but when. Expect government sponsored violence to increase exponentially. Be prepared and brave.

LawsofPhysics's picture

Stawks to the moon!!!!

Oh wait...

PiratePiggy's picture

shhhh! don't tell anyone about the new book i am working on -  "Capitalism's from Mars, Central Banking's from Venus"   ;)

CrimsonAvenger's picture

At the risk of being juvenile, can I suggest that central banking is from Uranus?

NoDebt's picture

How can the dollar be down and US stocks also down?  Unpossible.

CPL's picture

Because leverage eats itself ass up backwards when the reserve ratio is 1 million to one.  Yes... 1 million dollars for every real dollar in the the bank, then it's packaged like candy and sold to morons under the belief that the rewrapped junk is worth more in newer wrapping.

It works out about the same when a jug of milk goes bad and a person puts it back in the fridge for...let's see...12 years, and expect the milk to somehow 'get better'.  Well, it doesn't.  In this case the decay that leverage usually spins on an asset class suddenly jumps from 1st gear to 4th in the blink of an eye.  Goes from a predictable decay rate, to hyper speed atomization of ALL paper assets.

Including real watch the real estate market, it's about to shit the bed sideways, catch on fire and leave nothing of value behind.  Just like every other historical situation involving Fiat money and poorly managed assets.  That's not even the worst part...that is coming up right after everyone instantly becomes poor as houses.

So if everyone found things shabby today, just wait, it always gets weirder before it gets better.

//got silver, gold, BTC?

LawsofPhysics's picture

The eventual outcome for all fiat.  Collateral?  What's that?  Moral Hazard?  What's that?  According to your central planner, these are barbarious "relics" of the past.


Hedge accordingly.

CPL's picture

The biggest problem after the French revolution was determining who actually owned something in a currency that no longer existed.  While the law functions, when 9/10th of the law involves personal property ownership, it also means that the Judges then has to act as the economic lynch pin because it was their rulings that determined the value of something.  Even then a Judge in Lyon might have a different valuation of a property than say a Judge in Paris, literally e v e r y t h i n g has to be reassessed from a dead currency to whatever is lying around.

So it's going to get weird, believe me on this.  Keep all titles and deeds on hand.  Gold, silver and BTC.  Seeds, garden, tools.  Hardware, lumber if you've got the storage for it.  Take only with what you can carry and manage in trade.

LawsofPhysics's picture

No shit.  Debtors beware.  Redemption for those who paid off property and other assets (yes, cars, tractors, and boats also have titles).

Get long "security teams" and any means of production.


Tjeff1's picture

If the $ collapses suddenly the Judges will not have much say.  The judges will be the ones with the guns.  ie uncle Sam.  You will obey or die.

CPL's picture

What are you going to pay with?  Nothing.  You can't pay anyone.  No money usually means a cop, a fireman, a carpenter, a scientist...doesn't matter who.  Most of their, and your time will be spent probably figuring out how to feed yourself.  Everything around you isn't magic, it's all part of a supply chain system that wraps around the world.

Your grapes travel farther than a CEO on business.  The Beef most people eat is managed in Brazil.  The packs of bacon start in China.  The world economy is now at the point if one all goes down in a heap.  Not the same day mind you.  But it will introduce new challenges to people unused to physical labour.

There is no obey or die.  It's adapt or die.  The strongest are always killed outright first.  Always.  Only the tenacious survive any situation of change.  Societies can only afford strength when then have something to buy it with.  For the other 99.99999% in any human experience, tenacious/adaptable > strong.

hobopants's picture

Preach it brother! Although I think the infastructure to facilitate a transition to fascism has already been built, I have my doubts they can pull it off, I'm voting for some serious chaos, then god knows what... Possibly different states doing their own thing?.

crazybob369's picture

Better question: how can the dollar be down and gold be down as well? Isn't gold priced in dollars?

SheepDog-One's picture

220, 221.....whatever it takes!

CPL's picture

Until people stop taking dollars, which is all ready the case for labour and resource countries world wide for the past seven years slowly.  Like a lobster in a pot, it's cooked alive until it's done.

Soul Glow's picture

And people being the PBoC.

CPL's picture

They are going to get hosed as well.  Fiat never lasts.  Not even Chinese fiat currency.

Mr. Magoo's picture

Time to BTFD. Only if you are paul krugman

slaughterer's picture

Smart money is shorting the dollar and flattening their equity exposure today.  Low volume ramp  delayed until later this week.  Ramp will be triggered by one last USD/JPY firework. 

toros's picture

Sell gold - the real stuff not that paper crap.

nope-1004's picture

Every savvy investor, like Buffet, agrees with you and knows that the real thing is a useless investment.  Munger called gold bugs "jerks".  Bernanke "doesn't begin to understand the gold market".

So any knowledgeable person knows not to invest in anything with 4,000 years of history being a tangible, real form of money.  Buy the ETF's... they are rock solid.

Even Nostradamus recommended doing so:

Nostradamus: (Cent. 8 Quat. 28)

Les simulacres d'or & argent enflez,
Qu'apres le rapt au lac furent gettez
Au desouvert estaincts tous & troublez.
Au marbre script prescript intergetez.

Translates as:

The copies of gold and silver inflated,
which after the theft were thrown into the lake,
at the discovery that all is exhausted and dissipated by the debt.
All scripts and bonds will be wiped out.

BobTheSlob's picture

"Buy the ETF's... they are rock solid."....not that's a gem right there. SLV alone is owed around $7mill in bullion but is bulking up on shorts at the moment.

FreeBull's picture

I dedicate this song to the U.S. Dollar

Metallica's One

Hulk's picture

Actually, its at a 100 year low, but thats another thing entirely...

CPL's picture

That's the thing with fiat, it never holds it's value over the term.  Know the nursery ryhme about humpity dumpity?

Humpty Dumpty sat on a wall, Humpty Dumpty had a great fall; All the king's horses and all the king's men Couldn't put Humpty together again.
That's the history of fiat in a a poem.  It never gets fixed because it's mathmatically impossible to ever fix it because it's not built to be fixed.  Just used until it can't be anymore
Soul Glow's picture

Compund interest, bitchez.

WhyDoesItHurtWhen iPee's picture

Or, compound interest is a bitch.

Hulk's picture

Bottom line : Keep stackin Bitchez !!!, we are sitting on the greatest short squeeze in history...

Kprime's picture

Fiat, the original product with built in obsolescence.

Prior to governments mankind built products intended to last for generations. Go back far enough to the time when the concept of governments was new and you got products designed to last forever, pyramids.  The farther forward you go the shorter the life span of all real assets, until you reach a point where government throws out, regulates against, and bans products that last anytime at all.  You get USA, FRN, IRS, EPA, NSA, SEC, EBT, and fuck you America.  Rental slaves at every level.

Quinvarius's picture

Got to get that GDP up.

CPL's picture

Your wish is granted: hyper-inflation it is. (because that's how you get GDP up)

Jayda1850's picture

One of these days, the world is gonna say to the central bankers the same thing Rep. Ryan said to the head of the IRS, "I don't believe you." When the CONfidence game starts loosing confidence, the unravel will be quicker and more ferocious than any of us can imagine.

CPL's picture

Junkies looking for a fix; there are going to be severe with drawl pains, a tonne of denial and more than likely lots of outbursts until the poison is vetted from their systems.  Most won't make it without some type of substitute to get everyone back on track.  Hence; gold, silver and bitcoins.

So don't worry about it, this situation 'fixes' itself.  The head of the IRS won't be able to feed his grandkids or help their own kids, by the rope he helped weave.  The weirdest thing; they are all like idiot savants.  They know the math is unsustainable, but they do it anyways.  Just like junkies ignore their responsibilities in life and it catches up.  So will all of this...all 120 years in the blink of an eye.

Funny thing is the people that practice community efforts, are frugal, hardworking, honest and generally decent people won't be effected to much because they've controlled themselves by picking the mellow life.


BobTheSlob's picture

Make up your can't have it both ways. Either the head of the IRS won't be able to feed his grandkids or Bitcoin will be worth something. You can't have both.

CPL's picture

Most people can't sew a button on a shirt in the western world and no one seems to understand how to haggle.  That's how dumb and lazy everyone has become. They have ZERO life skills to accomplish much of anything unless someone drafts a statement of work and holds their dick while they piss.  Because even the head of the IRS, is worthless in that situation unless they actually know how to do business.  Examining the current market situation everywhere, it is doubtful any of the silver spoon set has a clue what the fuck they are doing. 

Here's the scary part, they 'control' it and they still can't do shit about their own system.  I'll restate my position as I have before.  I just need to wait.  Don't need to lift a finger because look who is in charge of it all.  Nor do any of them need to be saved, because they are obviously not adaptable enough to make a decision to be honest about what's happening.  This situation has ZERO to do with the technical aspects of currency, this is a management issue top to bottom.

As an engineer, I get paid to fix technical issues.  When I am hired by a client to fix something it requires an actual technical task to fix and an idea to develop.  When I walk into an organization and they have technology coming out their nose and nearly unlimited funds to procure technology solutions, it is meaningless if it's not managed.

Right now this is a management issue, not technical.  More specifically too many greedy pigs on top (fit for slaughter), no middle and a bottom that is walking away.  They will hang themselves and their own families because they were greedy, dumb, cowards with zero ability and accountability to hedge accordingly in the PLANNED event of collapse. 

See, this is all planned, every inch of it.  This is what 'well managed' looks like and this is as good as it will ever get for anyone in this system.  The reward for working in this fiat system is nothing.  Zero.  Because that's how the math works with Fiat always.  There is no option b-c-d-e, the only option left is "bust!" or hang from quickly built gallows (maybe even a head on a pike or three).  120 years and nothing to show for it but enemies of their own cousins in every corner of the planet.

That's the situation.  You might want to get a diaper on because what comes next...I can promise you will shit your pants.  Just like every other time in history that fiat is used.  This is literally just the tip of the iceberg.

//The currency in any situation btw is only a receipt that a transaction happened and every one is happy with the deal.  The trouble begins when 7.2 billion people aren't sure what anything is worth anymore.

J Pancreas's picture

"Noise" - Old Mister Yeller

Tjeff1's picture

What not able to export our inflation?  The horror.

SheepDog-One's picture

The U.S. LOLlar? Who cares if the value of it is tumbling, as long as we've got hope and promise many more of them will be imagined up out of thin air?

Chuck Knoblauch's picture

Each backed by a lunatic waiting for orders to turn a key and push a button.

Force is the only tool in the Pentagon's woodshed.

When force fails, they will surrender you to the enemy.

They've got deals cut protecting their asses.

ghostzapper's picture

Feels like I'm repeating myslef but what the hell:  if one were to analyze a weekly, logarithmic chart this thing looks pretty damn good no check that it likes like it potentially is setting up for a major move higher.  Last two times I chimed in were 440ish and 530-560 and though it wouldn't get below 540 it did pop from both of those buy zones. 

PaperWillBurn's picture

Agreed. I chimed in around $40 and was laughed at..funny, because we're going over $40k.

ghostzapper's picture

Grabbed my first batch under $200 frankly to expose myself and see what would happen.  been moving in more here and there with bigger positions.  Your number is low.

TheSecondLaw's picture

Came on board at $45, 80 and 100.  All my friends, except one, thought I had finally lost my marbles.  Sold all at $950, and then rebought at $450. Now I wait.

Tjeff1's picture

Could it be the Saudis are ready to abandon the Petro dollar?

PaperWillBurn's picture

Seems like the entire world is ready to abandon the $.


Just gave hellfires to Shiite PM in Iraq. Saudi / Qatar won't be happy.


Russia appears to be winning in the chess match..they've been dumping. China cutting deals with everyone and anyone to trade outside U.S.



Only a matter of time before central banks say fuck it and start bidding for gold with USD.

SheepDog-One's picture

I just mentioned this stuff to my parents yesterday morning who believe the U.S. LOLlar is teflon coated and will always just go on forever, I brought up that other major nations are now signing deals to bypass the LOLlar and trade in other currencies.....they just looked at me like I must be crazy.

nope-1004's picture

Same.  My sister actually thinks some cult got a hold of me and is "steering" me into some strange beliefs.  I just SFTU now and don't bother.  I don't really care what happens to them anymore.