How the yen could destroy the US dollar...

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Potemkin

Potemkin

Predaceous Stink Bug
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While we're all awaiting the US dollar's collapse due to (mainly) internal causes, the big one might come from outside and not even from China, but Japan:
http://www.primevalues.org/market-watch/japanese-economy-destroy-dollar.htm

The Japanese yen could potentially destroy the US dollar, because the two economies are so closely tied together... I didn't know that Japan has so many treasuries - almost as much as China!
If their yen inflation gets out of control, they might engage into massive US debt-selling and then everything would go crazy...

I have a feeling either the eurozone of Japan will go bust first, but if it's Japan, than the US currency might go with it. If it's the eurozone that goes bust, then the US dollar will gain from it.
 
Sigh...

This is the kind of retail analysis I hate to read that causes people to lose their shirts. The yen already had a massive correction. The weekly RSI got down to an 11 back in April. That is extreme. Almost generational.

What happened this past spring was the equivalent to what happened to the Euro back in the summer of 2010. EVERYONE was short the euro and convinced it was headed lower. How did that turn out? Not to well if you were short or were investing based on that thesis.
 
That maxim about the markets ability to stay irrational longer than you can stay solvent comes to mind.

For my part, I'm not trying to trade on what I believe will happen. I'm just trying to prepare for the consequences.
 
PMBug said:
That maxim about the markets ability to stay irrational longer than you can stay solvent comes to mind.

For my part, I'm not trying to trade on what I believe will happen. I'm just trying to prepare for the consequences.
Click to expand...

Me too... I think anything could happen. What if the US and Europe fall financially from internal reasons... But I found this Japan scenario interesting. I haven't thought of them being a potential US dollar crasher... Since everyone is only talking about China.
 
Yes. But it applies to the paper/casino markets. That's why I don't play with leverage.
 
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