Cannabis Prices & The Coming Devaluation of the Dollar

Milhouse said:

Whodare - Whose to say there arent rich schmucks out there like that now? I am sure there are plenty of rich dbags paying stupid prices because they think they are getting something really special. What will be the difference except for far fewer rich people!

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rick shaw said:

The OP obviously never studied any business or economics if he thinks the dollars value is based on gold and silver,nor is the cost of living tied to the precious metals commodity market.
The OP should go back to watching Glenn Beck and fox news for his understanding of the world around him.

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bobblehead said:

dollar, euro, yuan... they're all losing purchasing power if that's the point you're trying to make. Oil is more expensive around the world. Silver, Gold, w/e... World-wide inflation. [YES, WORLD-WIDE INFLATION][Caused Globally by Globalist Bankers, Devaluing the currencies around the world.]

Against which currency has the dollar lost purchasing power? I'm still waiting for that answer.

The future is Green Energy. Energy is a necessity, and the future is solar/wind/geothermal energy. Long term stored organic food? lol... Grow/can your own and sit in your bomb shelter waiting for the revolution to come.

I'll go on to achieve more financial gain and accelerate in my career of choice because of my slightly above average education. please... people come from around the world to get an education at a US University. Luckily my education has also taught me when my words have fallen on deaf ears.

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whodare said:

what's the point of this thread???

you are both saying the same thing essentially...

inflation is happening.

thing is Bobble is trying to say because the dollar is the worlds reserve currency when our dollar is devalued so is everyone elses.

until the world reserve currency changes we wont get killed with hyper inflation because the fed will continue to print money.

so we will see a rise in prices but it wont be as bad as anywhere else in the world (for now at least) because our government is printing money to pay it's own debt

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Milhouse said:

Im sorry but the few interviews with that Max Keisler, he is just a little theatrical for me! This may just be my opinion but when someone is overly dramatic, especially when talking about economics and finance (both of which are truthfully incredibly boring), it makes their message seem not as credible. Again, that might just be me.

It is the same situation with Glenn Beck! While he may have SOME good points from time to time, his delivery makes him lose all credibility. Same goes for Cramer!! If these guys would stop making everything sounds like the end of the world, more people might take them seriously!

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Milhouse said:

Im sorry but the few interviews with that Max Keisler, he is just a little theatrical for me! This may just be my opinion but when someone is overly dramatic, especially when talking about economics and finance (both of which are truthfully incredibly boring), it makes their message seem not as credible. Again, that might just be me.

It is the same situation with Glenn Beck! While he may have SOME good points from time to time, his delivery makes him lose all credibility. Same goes for Cramer!! If these guys would stop making everything sounds like the end of the world, more people might take them seriously!

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medicalgreen said:

I've been studying law, economics and currency for nearly 15 years now.

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bobblehead said:

I think you need to finish business school before asking such complex questions. Too many factors involved. The price of cannabis doesn't move unilaterally with gold. You have to take into account economies of scale with the cannabis industry. More and more people are getting into the medical industry, more states are decriminalizing consumption... Who told you the dollar is losing power? lol... Against which currency? Do you know how the value of a currency is calculated? The yuan has been held artificially low for at least the past decade... And the Chinese are holding TRILLIONS of dollars... they're not about to let the dollar collapse, and lose their investment. Tell me of a country that's not experiencing recession now.

Like I said, you have more to learn before you can truly understand what you're asking.

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Mighty greenback losing its lustre

JEREMY TOROBIN

Currency traders are betting on a lower U.S. dollar as interest rates in other leading economies look set to rise while the Federal Reserve stands pat, a glimpse of what could become a more enduring shift as market faith in the greenback slowly ebbs away.

When European Central Bank president Jean-Claude Trichet all but said last Thursday that he plans to raise interest rates in April to keep inflation in the 17-country euro zone from accelerating, a big gap opened up in expectations for monetary policy. Two days earlier, Federal Reserve chairman Ben Bernanke made clear to lawmakers on Capitol Hill that he is still comfortable with extraordinarily low borrowing costs, and that he has no intention of scaling back the central bank’s bond-buying program before it runs its course in June.

Policy makers in emerging markets from China to Brazil have already tightened this year, and central bankers from the Bank of Canada’s Mark Carney to the Bank of England’s Mervyn King are expected to follow suit well before the Fed.

As the gulf between the U.S. central bank and others widens, and as concerns ease that Europe’s debt problems could lead to a breakup of the euro zone, investors are “short selling” the U.S. dollar – betting that it will decline in value – and flocking to the euro to take advantage of the coming difference between European and U.S. interest rates.

Several analysts still see the greenback’s recent slide as a temporary swing that could reverse itself once the Fed starts raising rates, perhaps by the end of 2011. Still, alarm bells rung by Mr. Bernanke and the International Monetary Fund hint that the current episode may be a taste of things to come. A weaker currency would help U.S. companies sell their wares abroad, but those benefits could be overwhelmed if a selloff occurs because faith erodes that the U.S. government can make good on its debt obligations and calls increase for a new world reserve currency.

“I’m not certain that people are losing faith as opposed to trying to make a quick buck on a weaker buck,” said Michael Gregory, a senior economist with BMO Nesbitt Burns, noting that the share of foreign holdings of U.S.-denominated debt continues to rise, a sign that bond markets haven’t yet concluded that Washington is too risky a borrower.

At the same time, Mr. Gregory acknowledged that “over time, as a theme we have been seeing efforts to diversify U.S.-dollar holdings, not only among large institutional investors but particularly central banks, sovereign-wealth funds – those that have always used the U.S. dollar as core holding for liquidity purposes.”

Amid concerns about a looming fiscal crisis in the world’s biggest and most important economy, and as tensions in the Middle East and North Africa raise the prospect of energy prices rising so high that they slow or even derail the global recovery, the selloff of U.S. dollars that’s so far happening “at the margin” could broaden.

David Watt, a senior currency strategist at RBC Dominion Securities, said in an interview that while the amount of time the United States has before investors turn away from the dollar on a larger scale remains “the million-dollar question,” it is a matter of when, not if.

``What we’re talking about is the speed with which it will continue to lose altitude,” Mr. Watt said, pointing to factors like questions around whether fiscal stimulus measures in the United States are achieving their desired effect, and Washington’s persistent failure to come up with a long-term plan to attack the country’s debt.

“We’re not getting the growth rebound, so we’re not getting the rebound in revenues, so you get this idea that, yeah, maybe the U.S. debt situation is going to be a little bit more challenging than we had anticipated.’’ Still, until that so-called day of reckoning, a lower greenback has its perks.

President Barack Obama is trying to double U.S. exports over five years, and the weaker dollar helps American companies compete overseas with Asian or Latin American rivals.

Also, as recently as last month, the IMF told Group of 20 policy makers in a report that it views the greenback as overvalued, suggesting that “some further real effective depreciation” of the U.S. dollar would help rebalance the global economy.

And depending on its size, the boost that a weaker dollar could give the American rebound could benefit Canadian exporters too, even as it pushes the loonie higher.

“If we do see the U.S. economy really benefiting from a weaker U.S. dollar and growth is picking up, presumably stronger growth in the U.S. sucks in Canadian exports, regardless of the loonie,” Mr. Gregory said.

Meanwhile, recent research suggests that prospects for the U.S. economy have more influence on the Canadian currency in certain situations than energy prices, despite the notion of the loonie as a “commodity currency” because of the country’s status as a net oil exporter.

Marc Chandler, global head of currency strategy at New York-based Brown Brothers Harriman, wrote in a client note on Monday that while the loonie is at its highest level against its U.S. counterpart since 2007, it is actually among the weakest performers among the Group of 10 major currencies since Feb. 15, gaining less than 2 per cent even as oil prices soared 25 per cent.

Mr. Watt noted that in a fragile recovery where oil prices are being driven by concerns about supply, the relationship between oil prices and the loonie breaks down at $100 (U.S.) a barrel. At that point energy costs can become an impediment to growth.

“If oil prices are rising because demand is going up and the global economy is firing on all cylinders, then it’s out-and-out positive for the Canadian dollar,” he said. “But if oil prices are going up for other reasons ... and not reflecting underlying demand fundamentals, it’s much less clear.’’

With files from reporter Kevin Carmichael in Washington, and Bloomberg News.

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