As I am at a loss to explain many of the things going on these days, I will open this up for any and all:
-In what way would a weak jobs number (hence lower tax revenues and more government spending on benefits) result in a stronger dollar?
Circular logic may play out something like this:
Less jobs in US means less US consumer spending which means less exports for other nations so their revenues go down and the US dollar rises versus those currencies because it is better than those currencies because... well, it is.
If true the US should announce a total firing of every worker in the nation, unemployment at 100%, and then the dollar will be so strong we could just BUY China and have our very own manufacturing base. Any counter arguments?
5 comments:
The logic remains that all other fantasy currencies are weaker than our fantasy currency. Strange use of the word "logic." I'm with you, GYSC, on hating this rain. There was a brief moment of sunshine yesterday and I had to do other things, but really wanted to go out in the kayak. Next break in the clouds and you can find me on the Hudson!!
Lisa,
"It's all part, of my rock and roll fantasy...currencies"
Good luck on getting out on the water, why not just kayak around your back yard?
I could have kayaked down Main St. last night LOL Gully washers, we call them out West! I hate how much rain we've had, but it's a little less depressing here on the river. Come on over, we'll BBQ :)
You guys don't like the rain?
http://www.youtube.com/watch?v=geHngfHR0Vk
(Warning: Paul McCartney song, GYC.)
You guys should try coming down here to South Texas, where all we have is heat, and standing in a repossessed home that has no electricity, no water and no air conditioning with me. It's like standing in an oven. I'll bet money that you'd feint from heat exhaustion in 20 minutes. Then praise God the next time you see rain.
Anyway, the other day I was working on this historical price opinion for a mortgage insurance company. They wanted to know the fair market value of this house the loan for which they insured in June 2004.
2004? We didn't even get MLS online down here until 2005! So I had to dig out the old sold books from the office closet. Let's talk about fond memories of a bygone age. Good grief, it took hours to do what today would take 15 minutes.
But I found 3 comparable sales in the subdivision (all repos), and after adjustments priced the house at around $40,000. Then, out of curiosity, I went online and looked up the deed of trust from 2004. The loan was for $60,000!
Are you kidding me? No wonder they're investigating this deal. Maybe it was a HELOC, I don't know, but some appraiser had to value the house at $20,000 over market value in order for the loan to be justified.
Note. The same house just sold as a repo in May for $36,000.
This is what I'm talking about. It's fraud! Someone took a real bath on this loan.
It goes to that article from The Market Ticker I posted in comments the other day. This is not your standard inventory driven recession. This is a credit driven recession, and it isn't getting any better. Not with Fannie and Freddie issuing 125% LTVs, after a decade of 100% LTVs got us into this mess.
The bad debt simply must be defaulted, the losses taken and the entire financial industry reformed. Small chance of that happening, what with the functional retards we have in office these days. We're all Californians now. And it sucks.
Howbeit, your logic is impeccable, GYC. Yes, let's have 100% unemployment, 0 tax revenues, the strongest reserve currency the world has ever seen, and a competent, functional government. That's the ticket.
But I'll quibble with you a little. The dollar isn't strong simply because it is. It's strong because we have the largest, most lethal military on the planet that says it is.
Oh, wait, that military is being financed by foreign governments, all of which are rapidly going as broke as we are, financing our debt. Never mind.
I hope everyone had as nice a weekend as we had here. Three, count 'em THREE days in a row of sun, sun, sun. My back and arms are so sore from all that kayaking! :) Gawains, having lived in Texas and Arizona I'm very familiar with the kind of heat you describe. Oahu is the only place I've been with "perfect" weather, but being on an island for more than a couple of weeks makes me buggy.
GYSC, you outdid yourself with the videos. And, thank you for helping me to surprise my daughter. She mentioned that website "I can has cheezburger" and couldn't believe that I knew what it was LOL Thank you :)
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