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If the US dollar Fails

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MJ DeMarco

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Hello,

I just read this long article: Concerns Surround IMF Plan to Flood World With Liquidity, to summarize it looks like the US dollar is about to become the Venezuelan dollar.

My question is, what do we do to properly hedge for this type of thing, assuming we can. Also what are your thoughts on alternative currencies?

Hard assets and cash flow which can rise (or fall) with the transitions.

A business can raise prices.
A real estate investment can raise rents.

On the personal end, I recommend having a home free and clear without a mortgage, or, your mortgage is locked in cheap money (< 3%) and cheap inflationary dollars.
 

Kid

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We sit in central bankers pockets.
They want to unpower US?
They do so.

Its much better for them to have 5 equally weak countries at the top than 1 strong and 4 weak ones.

Exchange 3/4th of your dollars to yen, yuan and euro.
 

thechosen1

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We sit in central bankers pockets.
They want to unpower US?
They do so.

Its much better for them to have 5 equally weak countries at the top than 1 strong and 4 weak ones.

Exchange 3/4th of your dollars to yen, yuan an euro.
I am a bit curious about the Forex side of this.

If the US dollar is being inflated like the rest of the top 5 countries, surely there are countries experiencing deflation?

I believe the Kuwait dollar gained a lot of value in the recent past from deflation. There could be similar opportunities now in other currencies.

(Global reserve currency status is special for the US. But that might be under attack too. Other big countries could be vying to steal that spot...)
 

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The difference is everyone bases their currencies off of ours. So unless there is another country that can step up and take power then everyone will inflate and it will cause cost of living to increase and will create socio economic tension but the reality is that there is nothing to switch to.

China is a communist dictatorship.
Europe is weak.
Africa is a mess.

We're as good as it gets and we will hold that standard even if its in decline.
 

YanC

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Exchange 3/4th of your dollars to yen, yuan and euro.

Be careful with the euro. It has the same problems as the dollar, plus it's based on a fake nation (Europe) and creates massive issues between its countries.

The dollar is still the reserve currency of the world.

I also bet on the yuan as China is the only place in the world with regular interest rates.
 

Erick Rodgers

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Thank you all for your assistance, aside from precious metals, are there other hard assets you would recommend?
 

socaldude

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Well considering we are a country with a government that won’t stop selling out its citizens for bottom dollar and a country full of entities that won’t stop stealing everything that’s not nailed to the floor. It’s just a matter of time before there’s nothing left and civil unrest unfolds and hyperinflation ensues. I hope it doesn’t happen in my lifetime when we kill each other over all the resources and what’s left.

I know it’s been talked about for years and there are people who don’t buy it. But then again, considering people are complacent. Do you really think you’ll get a clear warning in advance when it does happen? It will happen quickly and suddenly and most investors will be unprepared.

But to answer the question you basically don’t want to hold cash or bonds. Any commodity or land or real estate is always good. Basically anything that’s actually worth anything. Even high end guitars can be a good form of protection. Things people need like oil or coffee beans. Anything that has utility. Even learning a useful skill can be hedge if you can’t afford the fore-mentioned.
 
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JordanK

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As long as the US military is the strongest in the world I can’t see much changing with regards to the dollar.

Money is a belief.

But a military is the power to enforce your belief on others if it comes down to it.
 

Kid

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I am a bit curious about the Forex side of this.
There was a "situation" where central banks of one (not that small) country
manipulated price of currency for profit.

That's one of things because of which i said "pass" to Forex.
If few people can dictate what's happening to whole currency
(including your portion of it) it doesn't look like a feasible way to invest.


As long as the US military is the strongest in the world I can’t see much changing with regards to the dollar.
Well, there is roughly x5 more people in China than in US.
They have advanced military - hypersonic missiles etc, and
if anyone will come with biologically enhanced soldiers first
it will be China.

If they wanted they could ruin US with NATO allies
and themselves in process.

They don't because it's not worth it.

This is one of reasons that US dollar isn't that strong,
nor protectable in foreseeable future.
 

thechosen1

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There was a "situation" where central banks of one (not that small) country
manipulated price of currency for profit.

That's one of things because of which i said "pass" to Forex.
If few people can dictate what's happening to whole currency
(including your portion of it) it doesn't look like a feasible way to invest.



Well, there is roughly x5 more people in China than in US.
They have advanced military - hypersonic missiles etc, and
if anyone will come with biologically enhanced soldiers first
it will be China.

If they wanted they could ruin US with NATO allies
and themselves in process.

They don't because it's not worth it.

This is one of reasons that US dollar isn't that strong,
nor protectable in foreseeable future.
It's very odd that our "leaders" seem to be trying to control the US population from growing too large.

Because if you think about it, by being a smaller population country, we are weaker, and countries like China and India are stronger.

They have more people...
 

Madame Peccato

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It's very odd that our "leaders" seem to be trying to control the US population from growing too large.

Because if you think about it, by being a smaller population country, we are weaker, and countries like China and India are stronger.

They have more people...

History showed us that having more bodies (even if they are merely walking corpses) to throw at an enemy army is extremely effective. That has been the Russia special in multiple wars.

But I don't know if that still holds true with all the toys we have now to exterminate populations and soldiers alike.
 
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thechosen1

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History showed us that having more bodies (even if they are merely walking corpses) to throw at an enemy army are extremely effective. The Russia special.

But I don't know if that still holds true with all the toys we have now to exterminate populations and soldiers alike.
In the present day, it appears that a larger population is still advantageous because you have a higher number of people able to do everything.

If 10% of people have high IQs, you could look at 10% of 200 million, or 2 billion.

That's 10 times the workforce for industries that require advanced intelligence and training.

Same applies at the bottom with regards to labor. And even though militaries use technology, more people = more soldiers using the technology.
 

Kevin88660

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Hello,

I just read this long article: Concerns Surround IMF Plan to Flood World With Liquidity, to summarize it looks like the US dollar is about to become the Venezuelan dollar.

My question is, what do we do to properly hedge for this type of thing, assuming we can. Also what are your thoughts on alternative currencies?
Make sure you own assets in your personal portfolio, not everything in cash and fixed deposit.

But in reality most people has too little cash to cope with expense or business emergency.

Inflation erodes your wealth slowly. But a “deflationary event” kills your wealth immediately when you need to sell assets penny on dollar to cover for bills or emergency.

As long as you own business or other financial assets (not bonds), as most do, you are well covered.

The key inflationary pressure is controlled by China. If China stops producing or sent their affordable manufactured goods to U.S. inflation will be an issue. C0VlD 19 has hurt global production speed and hence accelerated the inflationary pressure.

As long as the global economy planners can keep food prices, oil prices and walmart item prices low through production overcapacity, excess money printed to prop up financial market do not affect people that much. That was the game so far and it worked.
 
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Kid

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If 10% of people have high IQs, you could look at 10% of 200 million, or 2 billion.
That's true.

Also there is a thing about Chinese culture that they are (or became) very competitive among themselves. Or rather parents became competitive about their children's level of success.
It might backfire and create generation that will hate anything that's even nearly ambitious but it also might create self reinforcing system.

The thing that China lacks compared to US is freedom.

Its different to be millionaire in China and have delegated gov man
to check if you do everything as communist party tells (real situation)
and being in states, having freedom to throw all your cash
at girls and champagne.

Its pressure vs freedom.

Or intrinsic vs extrinsic motivation.
Unfortunately both work.
 

gloriusubiquity

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Hello,

I just read this long article: Concerns Surround IMF Plan to Flood World With Liquidity, to summarize it looks like the US dollar is about to become the Venezuelan dollar.

My question is, what do we do to properly hedge for this type of thing, assuming we can. Also what are your thoughts on alternative currencies?
This is just my opinion of course, but I would say buy real physical assets like a house and guns/ammo. If you really think inflation is going to rise, wouldn’t you just borrow money now since the value of money you need to repay will be decimated by the inflation?

I think the Fed will raise rates long before inflation becomes a problem, so the best inflation play/hedge is to bet that the Fed will act to prevent inflation from happening. When the Fed raises interest rates, stocks will most likely crash or stay flat as everyone holds their breath on how much the Fed will raise them, and how quickly (This was also the correct play in 2020… anticipate that the government will intervene and bet correctly on the market response)
 

Ronak

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Hard assets seem good in theory, but in a catastrophic worldwide black swan type meltdown, they may not be of much use as a store of value.

Anything kept on an electronic exchange is just as vulnerable as currency, so it has to be in tangible form.

You can only store so many grain, coffee beans, or other perishable items.
Non-perishables like gold bars, etc, still have to be stored somewhere. Then there's the issue of protection--if you're up against crazy mobs of hungry people, I'm not sure you'd have much real protection against theft, regardless of ammo, guns, etc.

Of course, I'm talking extreme level doomsday scenario here, like an EMP attack or similar. But, in today's connected world, even a single hack from a lone acting terrorist can wreak havoc on the power, water, or energy grid.

I guess it's sort of like the options plays-- you're good if the market fluctuates within a certain range, but can get wiped out just like everyone else if the whole market goes to the toilet.
 

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