Category Archives: économie

Ditch the Dollar?

dollar_chart1For years, economists, journalists and pundits have been predicting an end to the U.S. dollar as the reserve global currency. And for years, mainstream Americans and politicians have ignored the warning, presuming that the wolf-criers are simply anti-capitalist or anti-American.

But with the Fed’s most recent round of printing $1.2 trillion in ‘quantitative easing’, the only easing going on is the value of the dollar. To battle deflation, low housing prices and a crippled credit market, the Federal Reserve’s bold action will perhaps prove effective, but in the long-term might also prove the impetus to cede America’s leading superpower status.

America’s sugar daddy has already cautioned against the mind numbing spending spree taking place on Capitol Hill and the White House. They’ve slipped the hint—there are limits to their generosity. As long as their investments prove profitable, China will remain our loan sharks, but the minute the spending and printing begin bringing down their balance sheets, they will walk away. And so will the world.

Not only China has voiced concern, next week another ally plans to recommend ditching the green-back—the UN. Russia has been on the ‘ditch to dollar’ bandwagon for years and has kept up the rhetoric this week by calling for a global supercurrency.

From Reuters:

Currency specialist Avinash Persaud, a member of the panel of experts, told a Reuters Funds Summit in Luxembourg that the proposal was to create something like the old Ecu, or European currency unit, that was a hard-traded, weighted basket.

Persaud said that the United States was concerned that holding the reserve currency made it impossible to run policy, while the rest of world was also unhappy with the generally declining dollar.

“There is a moment that can be grasped for change,” he said.

“Today the Americans complain that when the world wants to save, it means a deficit. A shared (reserve) would reduce the possibility of global imbalances.”

What would the United States economy look like without the supremacy of the dollar? Hopefully, we will never know…

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Wall St Invasion?

The distress over the global financial meltdown encompasses more than just frightening 401k statements and doomsday newscasts. We’ve now another impetus for headaches and acid stomachs. This week, Libya’s Qaddafi became a major shareholder in Unicredit, Italy’s largest bank, which might have prompted the Italian Prime Minister Berlusconi’s warning. “I have news that oil producing countries with large funds are buying heavily into our markets.”

So beyond China helping the United States with its perpetually unbalanced budget, we’ve got Arabs trolling for bargains. Berlusconi elaborated: “Now there are great opportunities for those who have capital, and I think that certain sovereign funds, and ones you would oppose, are hostile.”

I take it that it isn’t just moderate Saudi Prince Al-Waleed bin Talal bargain hunting in the major indices. I use the term ‘moderate’ because apart from his support for CAIR and his comments after 9/11 which elicited a rejection of his $10 million check, he’s been a revolutionary among his fellow Bedouins. He has supported women’s rights and hired the first female pilot in Saudi Arabia.

As gas prices have ballooned and the economy has slowed, “drill baby drill,” has become an increasingly popular refrain repeated at McCain rallies. More than just cheap gas, it’s our sovereignty at stake.

According to Rand, U.S. oil shale reserves represent three times that of Saudi Arabia. Yet, we would rather buy the oil from the Saudis, making them wealthy enough to buy large chunks of our corporations.

Only in America

Air-Fore

The coffee is different, and the plastic parmesan doesn’t remotely resemble the fresh cheese from what used to be my local Italian markets. After spending four years in Europe, filled with cappuccino and brioche breakfasts, shopping at the local Orlando market or eating at the nearest diner had become a bit more depressing.

Of course, there is more to life than food, even though people-watching at the mall reveals that many are still unaware of that truism. But at least I had come back to chicken fingers and Cracker Barrel. And hey, we Americans, well, we always have hot dogs. Wieners and cappuccino aside, my reality changed in Europe, and it allowed me to see everything differently. I had never noticed how big our portions were, how cheap our gas still is, and how common sense had either never been preached, or had made a mass American exodus.

There are so many examples of inanity, especially when government is involved, but one of my recent favorites concerns the Air Force and its golf course in Niceville.

My husband Riccardo recently played golf with a friend who lives near Eglin Air Force Base. During the round, Riccardo asked if he had played Eglin’s Eagle course recently.

“Can’t. It’s closed for green reconstruction. They can’t afford to send decent boots or armored Humvees to our troops in Iraq, but they can afford to ruin the best greens in the panhandle. And all because the members wanted them flatter.”

I decided to do a little checking, not about the boots or the Humvees, but about the golf course and its planned remodel. With a struggling economy and a very expensive war, it seemed unlikely that the government would be spending money to renovate a golf course.

My first step was a Google search. Nothing. Never had my search pages come up as empty. Next, posing as a college student writing a term paper on golf course construction, I phoned Eglin Golf Course and spoke to a couple of people. They confirmed that the renovation had begun on all eighteen greens, but when I asked how much the project would cost, they clammed up. Eventually, I was able to squeeze the name of the company responsible, but the budget—it was classified.

Luckily for me, I was able to reach a higher-up in the golf course design firm, and believing he was helping my research, he let loose with the embargoed info. The project was running upwards of $1.8 million. “Normally, the time frame is shorter,” he advised. “But the Air Force has rules about days and hours we’re not allowed to work. They also have consultants which has made the process lengthier.”

The Air Force has golf course consultants? Any guess as to how many other nations have golf course consulting as a part of their military program? And God bless our troops and retired military, but can’t they learn how to put on undulated greens?

I suppose some congressman snuck an ear mark in some farm bill, or perhaps they didn’t even try to hide it. It doesn’t matter. Almost two million dollars to fix a golf course that didn’t need fixing is just one of the many nonsensical decisions that appear more glaring and feel more frustrating, since my return from a place whose citizens can’t afford to neglect common sense.