Wednesday, December 27, 2006

Slippery, Slippery, Slidey

Dollar Declines; U.A.E. Selling U.S. Currency and Buying Euros
If your head has been up from the grindstone lately, you may have already heard countries announcing that they will be diversifying their reserve holdings (selling, dumping) out of the dollar, and buying euros (or copper mines or oil and gas contracts) with their reserve holdings. Looks like the announcing is over and the doing has begun.

No country wants to be the one to set off an avalanche of selling. They tiptoe across the financial dollar mountainside, taking baby steps and holding their breath, staring up at a gigantic overhang of hundreds of trillions of slippery dollars, about ready to go.

And even as they inch forward, above them they can hear the artificial dollar pumps going full blast, insanely adding more overhang by the hour.

It looks like Denver is in for another snow tomorrow. Avalanche season will soon be upon us.

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