More "Falling Dollar" News

[westcoastbias]

Foreign Interest Appears to Flag as Dollar Falls

By EDMUND L. ANDREWS
New York Times
Published: November 27, 2004

On Tuesday, a top official with the Russian central bank said his government had become worried about the sinking value of the dollar and might switch some foreign reserves to euros. "India's central bank hinted that it was worried about the same issue and might shift some reserves into other currencies."

"Sell U.S., buy Europe," summed up Richard Berner, chief United States economist at Morgan Stanley, in a report last week."

"The market for U.S. Treasury securities is deep and liquid and continues to be attractive to a broad and diverse pool of investors," a spokesman for Mr. Snow, Robert Nichols, said. That remains to be seen. According to the most recent Treasury data, the biggest source of growth in securities came not from China, Japan or Europe but from Caribbean banking centers."


http://www.nytimes.com/2004/11/27/business/27dollar.html



Does Bush and Company even recognize the problem?

[RC]

1. How about an excerpt or two?

[Warpy]

3. Here's the bottom line

There is an emerging consensus that banks around the world are moving to expand their reserves of euros at the expense of dollars," said Laidi Ashraf, chief currency analyst at MG Financial Group in New York.

The Bush administration has essentially condoned the dollar's decline. At meetings with foreign ministers last week, the Treasury secretary, John W. Snow, repeated the American mantra of support for a "strong dollar" but also for letting "market forces" determine exchange rates.

http://www.nytimes.com/2004/11/27/business/27dollar.html

So far, I've seen nothing about last week's auction of bonds to float the latest treasury debt ceiling. Also, when the bonds currently being held mature, I doubt they'll be allowed to roll over.

We're in big trouble, folks. Although China doesn't want to kill off its biggest market, those old boys aren't stupid. They know that the system can't sustain itself in its present form. If Bush won't abandon his policy of fattening the rich, beggaring the rest of us and exporting jobs, change will be forced by the currency brokers.

Bush, of course, will have absolutely no clue in the world what to do, since everything that needs to be done is contrary to his dogma, and we know for Bush, dogma is everything.

[papau]

4. Below discusses how :Caribbean banking has replaced Central Bk support

Foreign Interest Appears to Flag as Dollar Falls
By EDMUND L. ANDREWS

Published: November 27, 2004


WASHINGTON, Nov. 26 - Investors and market analysts are increasingly worried that the last big source of support for the American dollar - heavy buying by foreign central banks - is fading. <snip>

On Tuesday, a top official with the Russian central bank said his government had become worried about the sinking value of the dollar and might switch some foreign reserves to euros.

A day later, India's central bank hinted that it was worried about the same issue and might shift some reserves into other currencies.

Japan and China, which together have amassed nearly $900 billion in United States Treasury securities, have both slowed their buying sharply from the frenetic pace in February and March.

"There is an emerging consensus that banks around the world are moving to expand their reserves of euros at the expense of dollars," said Laidi Ashraf, chief currency analyst at MG Financial Group in New York.<snip>

[NMDemDist2]

2. welcome to DU and a heads up....

according to the LBN rules, you must post the actual headline

also it's considered polite to post up to four paragraphs of the article (esp of a site that requires registration)

[nadinbrzezinski]

5. hmmm more "good news" huh?

So anybody knows how good were the sales numbers today? I mean the real sales numbers?

[UpInArms]

15. here's as close as I could get to

any information out there:

(this one is from the 24th)

Treasurys grind lower with eye on Fed
Auction aftershocks fuel further curve flattening

http://cbs.marketwatch.com/news/story.asp?guid={95618d1c-1a02-4a18-9be0-a389a878fbb4}&siteid=google&dist=SignInArchive&archive=true¶m=archive&garden=&minisite=

CHICAGO (CBS.MW) -- Treasurys traded lower Wednesday, propelling 2-year note yields up past 3 percent for the first time in more than two years, with the market looking to another likely move by the Federal Reserve in December.

<snip>

And the Treasury Department announced Wednesday that it would on Monday auction $36 billion in 3-month and 6-month bills to raise $2.1 billion in new cash. The department left the size of the 3-month auction at $19 billion and the 6-month offering at $17 billion.

...more...

and a Reuters from today:

http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=6931361

Treasuries Lower on China U.S. Debt Report

NEW YORK (Reuters) - Treasury prices sank on Friday as reports the Chinese authorities might be shedding some of their U.S. debt holdings sparked fears of broader selling from Asian central banks.

But traders said thin volume was exaggerating the extent of market action, and argued that offshore central banks were still showing plenty of interest in U.S. government debt.

<snip>

"While we, and others, are inclined to entirely dismiss the weakness those comments generated, the technical damage is real and we're not fully recovered despite a pretty complete denial of the notion that China cut back on Treasuries," said David Ader, a U.S. government bond strategist at RBS Greenwich Capital.

...more with lots of cheerleading and confusion mixed in...

[Deja Q]

6. No good deed goes unpunished.

We give India our jobs and this is how they repay us? Nice.

Oh, how can Snow-job call the dollar liquid? Unless it's urine?

[bhikkhu]

16. Perhaps he meant the presses are running full steam...

no shortage here - dollars on demand!

[found object]

7. Q: who's going to buy all these securities?

Almost a trillion between China and Japan -- who are they going to dump on if the dollar is so low, or is the really a question of the dollars potential of being a good investment?
Strange times indeed.

[Skink]

8. Soros must be making a killing

Maybe all that color we are adding to the money isn't really neccassary.

[tuvor]

20. Ya wanna rephrase that?

If you're trying to make a point, you might want to try again.

[VegasWolf]

9. err,umm, what about the new 300 B deficit spending bill just passed.

No way in hell can things hold together.

[found object]

13. It's going to get worse, I agree

But, I image there will be a point when investors start seeing the dollar as, once again, a good buy. Just before the stock market tanked big investors had already sold out, now they're back on board picking and choosing and seem to be doing pretty well.
It seems to me those countries with a lot of dollars in reserve would want to wait 'till the dollar improves before dumping them, and therefor the dilemma I'm having with this whole crisis. It'll be interesting to see who the winners and losers are in another six months -- most likely the bloke who pays taxes in this country.

[Chicago Democrat]

17. The fundamentals all point towards down...

Just 2 YEARS ago
$.80 bought a Euro then
it was .90
then it was 1.00
then it was 1.1
then it was 1.2
then was 1.29 just last week!
now its 1.33!

1.40 is just a matter of time
1.50 is possible
1.60 is plausible
1.75 is feasable

[VegasWolf]

18. For me, it's about return on investment, I don't want to be

holding assets that are dropping like a rock. At
some point there will be a bottom, why hold your
assets to that point. Venezula's GDP this year
was 17.5%. The US economy is struggling with a
deficit, a go it alone war, a Sec of Commerce
who thinks outsourcing and a weak dollar are good
things. Why hold US assests, especially as the rest of
the world divests theirs.

[AllyCat]

14. Don't forget! Chimpy wants veto power on that...

...he hasn't vetoed a single spending bill in his first term and now he wants LINE-ITEM VETO? Evil Chimp.

[oblivious]

10. Dick Cheney and groupthink: "Reagan proved that deficits don't matter."

Anyone that says different is anti-American.

[Yavin4]

11. Forget About The Currency! Homosexuals Are Getting Married!

White women are disrobing and having sex with Black football players. Basketball players are fighting with fans. We've got much. much bigger problems to talk about. At least that what the media says.

[Conservativesux]

Yeah, forget about that little war in Iraq. Lets put things into...

perspective here, People.

We can have two adults of the same sex marrying each other. King George tells us so. :puke:

[Conservativesux]

21. Yeah, forget about that little war in Iraq. Lets put things into...

perspective here, People.

We can have two adults of the same sex marrying each other. King George tells us so. :puke:

[Doc_Technical]

12. "U.S. Treasury securities are liquid",

they soon will be because they will get a bad case
of the runs.

[NYC]

19. On the bright side,

the lower dollar should increase tourism. It will be a real bargain for foreigners to come here.

(That's the only silver lining I can find in this cloud.)

[frustrated_lefty]

22. I wish we could hear from Krugman.

By the time he gets back, he's got 6 months worth of columns pre-made.

[Moderator]

23. Headline

You should have written as your subject line:
Foreign Interest Appears to Flag as Dollar Falls

Please check the rules of Latest Breaking News poste at the top of this forum.
( Too late to edit )