Dollar Up or Down in the Financial Race of the Century?
Posted: Wednesday, June 03, 2009
by Jean Purcell
OpineBooks.com
Who would have thought when China's Chairman Mao took the equivalent of millions of regime-backing dollars monthly from the Soviet Union, to prop up his cruel and tormenting regime, that post-Mao China would overtake the collapsing USSR, Europe, the rest of Asia, and probably the USA?
The model of a stable country like China, with a communist or socialist government and a thriving independent capitalist base, is a new headline for observers of winners. A new urgent and intense attraction turns the heads of global journalists, economists, political scientists, and historians.
Like the major horse racing series of a century or centuries to come, China's hard-working Yuan stands inside its gate at the track, eager to take off and win. Dollar, the arrogantly praised champion, tries to back out and is kicked into submission before the next qualifying race starts.
Given the new context of champions, Yuan's stable backed by communism joined with socialism joined with independent capitalism might win. Yuan wears solid monetary colors that seek to replace Dollar's red, white, and blue. All eyes are now on Yuan.
Like every champion's shift, the weakened speed in the new U. S. investors' and planners' Dollar, supported by waning tax revenues, seems to have struck overnight. The predicting indicators multiplied long before they were acknowledged. It has been a long time since Dollar received good training and care, and so he no longer runs well, as he used to do, in rain and mud.
Storm clouds that have hovered long now gather more abundantly. In a case of reverse Chicken Little, Dollar's managers object to ultimate problems over the clearly fading blue skies: "You're wrong; dark clouds have nothing to do with Dollar. He will always run well in rain or storms!"
When it was noticed that Dollar had been criminally neglected at home, financial journalists reported that the UK's Pound stood poised to win the race to replace Dollar's power. Then Pound's lowered ranking cut into the UK's bets as Pound started to pull back to rear outside position in qualifying races.
Japan's Yen, a solid second, also fell behind. Yuan has come up from the outside and run along the inside rail, gaining momentum. Yuan has the clear advantage now of favor, with crowds able to go for a long time, like Yuan. China's crowds represent the world's largest consumer base, cheap and competent, non-unionized labor, a solid economy and eagerness to continue to cheer for their Yuan. They are unified to stay with their horse.
Will anyone win the Grand Race Series by lengths? Former giants of this kind of racing environment admit that they may have to back Yuan, having formerly cheered for Dollar or Yen.
Among the crowd, the financially able are tempted to back Dollar publicly while privately preparing to shift support to Yuan. The increasingly mud-drenched track clearly favors Yuan. That horse is used to persevering at any cost and its team of jockeys rides to win more than to garner personal praise. It's a team effort for Yuan, and powers behind this runner require cooperation at whatever personal costs to riders or cheering crowds.
The crowds in the stands, along the rails, and in the center field invested heavily in a confident Dollar before. But Dollar's bankrupt stable, if the U. S. president is correct and the U. S. is "out of money," cannot run a healthy or competitive horse. Some in the private boxes continue to talk positively, hoping that wishing will make it so.
This champion race is on, and odds favor Yuan. There is no doubt about it. But, can Yuan win? Overnight, bets on Yuan could overtake all others. It may not be that those bets will be rewarded in the winner's circle.
Dollar may revive, although present performance gives no realistic reason to hope for good news soon. That horse lags while many in charge of Dollar's future talk a good line about a horse that could continue to lag on the track.
Dollar-investing crowds in the low-cost places need Dollar to run well more than anyone, whether in Win, Place, or Show. Show might be possible, and those crowds might not be taken down with a falling horse.
Meanwhile, journalists tend to cut slack for those in high-priced seats, and fail to report that no cheers for Dollar ring with glee, expectation, or demands that Dollar receive honest care to regain strength.
Silently, that horse may go down. Most freedom-loving people hope not.
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Top-level comments on this article: (3 total)Hi Jane.Great article, kind of depressing due to the painfully accurate comparisons, though.How could our country get in this position? How can we get back to strength? CAN we get back to strength?It was an enjoyable read, nonetheless.Hi Ken, I don't have answers, only observations and hopes. We who believe that God will help those who trust in Him can encourage others in words and deeds. We can continue to work and also become debt-free (I'm a Dave Ramsey reader). All the best to you, Ken.You are making a good difference where you are, I feel sure. Thanks for reading and commenting. Sincerely, Jane
Hi Jane,I really enjoyed your article. I suppose the days of pumping up Dollar on steroids are history. Those artificial injections wreacked havoc on the beast anyway. It is sad, but I think Dollar needs to be retired. Perhaps, some day soon, the son of Dollar will rise and run and leave many truly amazed. But, until that time I suppose all we can say is... "Getty up"... ?Blessings to you,Mark ParsecHi, Mark Dollar has been mismanaged, used, abused, and almost run to death by NYC and DC Capitol managers. Dollar needs honest and knowledgeable, debt-avoiding new handlers, for starters. Mark, thanks for reading and commenting. Sincerely, Jane
Who would have thought to write about this subject in terms of a horse race? I was hooked at the first paragraph. This is great writing.Now, one would think that having a strong dollar would be a good thing. But somehow, in Canada, whenever the dollar gains strength against the US dollar, the government panics and says this is bad. Of course, they are only thinking of those companies that export goods from this country, as it becomes more expensive for other countries to buy our products. When our dollar is weaker, our products become less expensive for other countries and our sales go up. But the importer wants a stronger dollar so he can buy from other countries without breaking his bank account, and the Canadian tourist wants a stronger dollar, so travelling to other countries (ie. USA and Europe) doesn't cost as much. I guess you can't please everyone.
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