The U.S. government’s slick little plan to “save” the economy by destroying the dollar is working like a charm. The U.S. dollar is now at a 2009 low against the euro. And believe me, the euro is no peach.
According to Bloomberg:
The euro is “struggling” to rise above resistance at $1.4720, just above the high from Dec. 18 and now a “key focus” for traders…
The dollar traded at $1.4661 per euro at 10:19 a.m. in New York, compared with $1.4658 yesterday. It earlier reached $1.4714, the weakest level since Dec. 18, when it touched $1.4719. Japan’s currency gained 0.5 percent to 132.87 per euro, from 133.47. The yen appreciated by the same amount to 90.57 per dollar, from 91.05. The last time the yen was stronger than 90 was Feb. 12.
The good news is that as the Treasury prints money and ensures a long-term economic malaise, Crisis Trader readers are making a fortune from the small gold mining companies we bought at the bottom.
According to The Globe and Mail:
Gold hit 18-month highs on Wednesday as the U.S. dollar's slide to 2009 lows versus the euro sparked buying of the metal as an alternative asset, helping lift silver and platinum to multi-month peaks.
The precious metal now has its sights set on a new all-time high above $1,030 an ounce, traders said.
U.S. gold futures for December delivery on the COMEX division of the New York Mercantile Exchange rose $11.40 to $1,017.70 an ounce.
I know what you’re thinking: Gold has to be the most obvious buy of the decade. Perhaps your contrarian mind starts thinking that it can’t be that easy.
Well, don’t fret, dear friend. Rest assured that the government will print more money. In point of fact, Congress is going to raise the debt ceiling yet again.
According to CNNMoney:
Congress has raised the debt ceiling four times in the past two years and will probably have to do it again in the next month.
With the government borrowing record amounts of money, the nation's current debt ceiling of $12.1 trillion will be pierced soon.
That ceiling is the cap on how much the country allows itself to have in debt. In credit card parlance, the ceiling is the U.S. credit limit. At the end of August, U.S. debt totaled $11.8 trillion. That's roughly $349 billion shy of the statutory limit.
The ceiling is meant to serve as a brake on spending because lawmakers would have to think very seriously before they breach the limit and take a very difficult political vote to do so. In reality, lawmakers really don't have a choice but to raise the ceiling and they know it.
So you see, the dollar will fall, gold will go up, and new dollars will be printed. Do you feel “saved?” I know I do.
The next liquidity bubble will be in gold – bank on it.
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