Foreign Investor Dump

[shooga]

Foreign Investor Dump


"... the decline of the dollar against the Euro is a precarious situation right now ... foreign investors could heavily dump U.S. Treasury Bonds which would further drop the dollar and raise the U.S. debt ..."

[tom_paine]

1. Investors are nervous investing in Totalitarian Nations

like Imperial Amerika.

I can't blame them for pulling their money out and using it to back the Free World.

[Frodo]

2. Could????

What's the point of the post?

The dollar had been falling for months and the money flowed in last month. Now the dollar is essentially flat (over the last 30 days) and they're all going to "dump"?

Foreign investors COULD heavily buy Snickers (tm) bars. So?


US assets look incredibly cheap right now... so OF COURSE they will all want to "sell low" after they "bought high"?

Those pesky "fahrners".

[On the Road]

3. It's Happened in Other Places

Poor domestic outlook and bad fiscal policy produces a run on the currency -- Mexico, Indonesia, South Korea, Argentina.

Yes, the stock market is probably being propped up by the decline in the dollar. But that's only one factor. Like any other security, fundamental analysts will see a buying opportunity while momentum investors will anticipate a continuing trend. And momentum investing seems to have become more popular in the last decade.

[Frodo]

5. Sure.... but

Can you maybe think of a few difference between Mexico, Indonesia, South Korea, Argentina and the largest economy in the world???

I think the US economy is roughly ten times the size of the largest of those four. None of them have currencies held worldwide like the dollar.

Run on the currency? I doubt it.

[Frodo]

4. Latest information I could find.

"Foreign investors pumped $87.6 billion more into U.S. stocks and bonds in November, up sharply from
$27.8 billion in October, according to the Treasury Department's latest monthly tally"