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I have no idea who the OP is but a lot of the stuff is not accurate (I saw the previous post that was linked here). It is a slightly less factual ZeroHedge. Fo

I have no idea who the OP is but a lot of the stuff is not accurate (I saw the previous post that was linked here). It is a slightly less factual ZeroHedge. For all it's faults, ZeroHedge actually gets the mechanics roughly correct (although often doesn't get the interpretation right leading to odd conclusions). But a lot of the OP is just...not correct (as an example, the OP says that countries were on the gold standard in the 1920/30s and devalued as a response to the crisis...wrong, they were on the gold exchange standard and devaluation wasn't the response, it was suspension of convertibility) and vague (all these posts are very wordy, poorly written, and seem intended to reach a conclusion that was arrived at before any evidence was examined). I don't know why people are so fascinated with the idea that their currency is worthless. In the US, I assume it is related to the fact that much of America has German roots...where this "currency crash literature" is also a fetish. But if you are worried about inflation, own gold, own inflation linkers, and own good businesses. That is it. Also, maybe the dollar will fall in value but if you are in the US and have USD liabilities, it makes no difference to you. Stuff that cost $1 will still cost $1.

exolymph 7y ago
> maybe the dollar will fall in value but if you are in the US and have USD liabilities Are you proposing that the value of USD rises and falls in a geopolitical and macroeconomic vacuum?
- hogFeast 7y ago
  ...no. You are overthinking this significantly. If the USD falls 20% against the GBP or JPY or whatever...why do you care? It doesn't affect you...unless you have liabilities priced in terms of that other currency. The fall and the rise of the USD is very important outside the US. It makes no difference to 95% of people within the US.
  - gumby 7y ago
    > The fall and the rise of the USD is very important outside the US. It makes no difference to 95% of people within the US. Except that their lawn mowers and phones are manufactured overseas. So they are implicitly, if loosely, exposed to forex. If the swing of the dollar makes French cheese or wine too expensive people will switch. If they need a new refrigerator they have less choice.
    - hogFeast 7y ago
      Yep, it doesn't work that way. First, the US isn't a big trader relative to the size of the economy. Second, depreciation doesn't passthrough to inflation 1-to-1. Three, because of the relative size of the US economy and the international use of USD, US imports are generally not sensitive to exchange rates in the way that you see in other countries. Btw, I live somewhere where the currency has depreciated significantly, and we import almost double what the US does...prices go up a little but not much. And for most people, the difference is just zero (the difference for companies is often not zero...companies are often constrained in how they change prices, which is the reason for a lot of the point above, so they end up taking a lot of cost changes to their profit).
AnimalMuppet 7y ago
> But a lot of the OP is just...not correct (as an example, the OP says that countries were on the gold standard in the 1920/30s and devalued as a response to the crisis...wrong, they were on the gold exchange standard and devaluation wasn't the response, it was suspension of convertibility) I believe that you are incorrect. The US, for example, suspended convertibility at $20/oz, confiscated holdings of gold (!), then changed the price to $35/oz, and resumed convertibility. That's not just suspension of convertibility, it's also devaluation.
- hogFeast 7y ago
  I would read what I said more carefully. I did not say that countries did not devalue.
  - AnimalMuppet 7y ago
    Well, OK, then you said that in response to the crisis, they suspended convertibility. But the US suspended convertibility, devalued, and resumed convertibility, long before the crisis was over. That means that the point had to be the devaluation, not the suspension of convertibility. (Or else they were incredibly stupid in how they did it.)
    - hogFeast 7y ago
      Right, and I said "in response" to the crisis not "before the crisis was over"...again, you are continuing well after the point of logic. Read. Carefully. And the key point was most certainly not the devaluation. I can only suggest you read more about the Great Depression to understand why (there was the small matter of most banks in the country failing, devaluing your currency does not help with that, suspending convertibility does). Basic. Basic. Basic.
      - AnimalMuppet 7y ago
        You might try speaking more clearly. And you might actually give some data instead of just dripping condescension. So far, all you've said is "I know, and I'm right", which is a really worthless conversation. Oh, yeah, you said "read up on the Great Depression". Well, there's rather a lot that could be read on that. You might be a bit more specific, if you wanted to be helpful rather than just smugly condescending. And so far, you haven't said anything to make it possible to tell whether you're a really knowledgeable guy I should listen to, or whether you're just a loudmouth crackpot who's sure that he's right and everyone else is wrong.
xxpor 7y ago
Most people's ancestors of German heritage came over before the hyperinflation of the interwar period. I don't think there's much there.
- hogFeast 7y ago
  Yep, it started well before hyperinflation (and is in countries that are adjacent to Germany).

exolymph 7y ago

> maybe the dollar will fall in value but if you are in the US and have USD liabilities Are you proposing that the value of USD rises and falls in a geopolitical and macroeconomic vacuum?

hogFeast 7y ago
...no. You are overthinking this significantly. If the USD falls 20% against the GBP or JPY or whatever...why do you care? It doesn't affect you...unless you have liabilities priced in terms of that other currency. The fall and the rise of the USD is very important outside the US. It makes no difference to 95% of people within the US.
- gumby 7y ago
  > The fall and the rise of the USD is very important outside the US. It makes no difference to 95% of people within the US. Except that their lawn mowers and phones are manufactured overseas. So they are implicitly, if loosely, exposed to forex. If the swing of the dollar makes French cheese or wine too expensive people will switch. If they need a new refrigerator they have less choice.
  - hogFeast 7y ago
    Yep, it doesn't work that way. First, the US isn't a big trader relative to the size of the economy. Second, depreciation doesn't passthrough to inflation 1-to-1. Three, because of the relative size of the US economy and the international use of USD, US imports are generally not sensitive to exchange rates in the way that you see in other countries. Btw, I live somewhere where the currency has depreciated significantly, and we import almost double what the US does...prices go up a little but not much. And for most people, the difference is just zero (the difference for companies is often not zero...companies are often constrained in how they change prices, which is the reason for a lot of the point above, so they end up taking a lot of cost changes to their profit).

AnimalMuppet 7y ago

> But a lot of the OP is just...not correct (as an example, the OP says that countries were on the gold standard in the 1920/30s and devalued as a response to the crisis...wrong, they were on the gold exchange standard and devaluation wasn't the response, it was suspension of convertibility) I believe that you are incorrect. The US, for example, suspended convertibility at $20/oz, confiscated holdings of gold (!), then changed the price to $35/oz, and resumed convertibility. That's not just suspension of convertibility, it's also devaluation.

hogFeast 7y ago
I would read what I said more carefully. I did not say that countries did not devalue.
- AnimalMuppet 7y ago
  Well, OK, then you said that in response to the crisis, they suspended convertibility. But the US suspended convertibility, devalued, and resumed convertibility, long before the crisis was over. That means that the point had to be the devaluation, not the suspension of convertibility. (Or else they were incredibly stupid in how they did it.)
  - hogFeast 7y ago
    Right, and I said "in response" to the crisis not "before the crisis was over"...again, you are continuing well after the point of logic. Read. Carefully. And the key point was most certainly not the devaluation. I can only suggest you read more about the Great Depression to understand why (there was the small matter of most banks in the country failing, devaluing your currency does not help with that, suspending convertibility does). Basic. Basic. Basic.
    - AnimalMuppet 7y ago
      You might try speaking more clearly. And you might actually give some data instead of just dripping condescension. So far, all you've said is "I know, and I'm right", which is a really worthless conversation. Oh, yeah, you said "read up on the Great Depression". Well, there's rather a lot that could be read on that. You might be a bit more specific, if you wanted to be helpful rather than just smugly condescending. And so far, you haven't said anything to make it possible to tell whether you're a really knowledgeable guy I should listen to, or whether you're just a loudmouth crackpot who's sure that he's right and everyone else is wrong.

xxpor 7y ago

Most people's ancestors of German heritage came over before the hyperinflation of the interwar period. I don't think there's much there.

hogFeast 7y ago
Yep, it started well before hyperinflation (and is in countries that are adjacent to Germany).