Wednesday, November 29, 2006

I'm Hanging On To My Dollars

I predict the dollar's drop against the Euro will continue, will cause nasty consequences for the bad guys, and will be reversed when Americans elect a financially responsible Congress or Europe goes under.

Here's the WSJ ($):
When U.S. economic policies look like they might take a turn for the worse, dollar-denominated assets lose some of their allure. So, for example, when the new Democratic majority in Congress talks about raising taxes on capital gains and dividends, investors in U.S. financial and corporate assets get the jitters.
The good news is a weak dollar will tank the Euroweasels and China, because the US won't be able to import from them.

It shouldn't effect US energy prices because oil is priced in dollars. But even if that changes, it'll just trigger the US to drill for its own oil and/or build nuke power stations.

And when a new US Congress goes back to cutting taxes, and/or the weasels gets nuked by their Iranian buddies, the dollar will pop back up again.

What's not to like?