The Dollar's Denial

[marmar]

from HuffPost:





David McWilliams
The Dollar's Denial
Posted March 6, 2008 | 02:45 PM (EST)



In the 12th and 13th centuries, Venice was the centre of the trading world. Crusaders and merchants of all sorts came through this great city to travel to and from the Holy Land. The streets were awash with coins from all over the world. Thus the money changers of St Marks Square were pivotal characters in the commerce of the city, and indeed the globe. Every day, the money changers sat at their benches (called banca), coins piled high in front of them, shouting various exchange rates as currency ebbed and flowed. If a Crusader ship docked laden down with coins from the Levant, the value of the Levantine coins would fall in response to the huge new supply, and vice versa.

Buzz up!on Yahoo!When a money changer went broke, it was customary to smash his bench. The resulting broken bench or (banca rotta) was borrowed by Norman merchants on their way home from the Crusades to Ireland and England, giving us the word bankrupt.

Looking at the dollar as it plunges to record lows against the Euro, the image of the Venetian money changers and their smashed benches comes to mind, not because America is anywhere near bankrupt, but because the dollar has always been a leading indicator of where the US economy is headed.

Due to the tyranny of daily media updates and the nano-term nature of financial markets, we rarely get the opportunity to look at today's developments in a historical context. Yet if we go back to our money changers in Venice with their broken benches, we see that the dollar's fall is much more fundamental than the reaction to the latest price of data on the US economy. It is part of the gradual debasement of the US currency as the US government tries to fool its own people about the long-term decline of the United States.

An easy way to look at the emasculation of the dollar is to think about the expression "as good as gold." This comes from the idea that nothing could take the shine off this most exotic of metals, and that gold is an incorruptible store of wealth. Yet, over the years gold has been corrupted and tampered with, leading to a fall in the value of certain currencies. .....(more)

The complete piece is at: http://www.huffingtonpost.com/david-mcwilliams/the-dollars-denial_b_90270.html

[ORDagnabbit]

1. scary... the USD index broke into the 72's today...very very very very bad

[enid602]

2. condo

Well, it would make you think twice before buying that condo in Manhattan.