S P Futures

by Āc futureofdollar.com

INTRODUCTION

The world worries about the dollar does not play the role of the main reserve currency any longer after the financial crisis triggered by U.S. mortgage market collapse led to the worst global recession since the 1930s. government recovery plans to bail out the financiers, the need to support the liquidity of Treasury securities, keeping interest rates low in the circumstances of slow economic growth, high unemployment and low recovery the tax to print more dollars. This leads to an increased risk of high inflation or hyperinflation in the long term.

With a debt of $ 12.3 billion domestic and $ 55 trillion in unfunded liabilities in programs like Social Security, Medicare and Medicaid, with total commitments of Federal Reserve and the Treasury bailout now 11 8 trillion U.S. dollars, including 3.6 trillion dollars have been spent in the United States must take immediate steps to protect themselves against potential loss of purchasing power of their U.S. dollars, warns inflation.us.

Although there is still no data on the high inflation in the U.S. and international stock markets and commodities grew abnormally in the last eleven months. Analysts called the "flight of the dollar" or "risk diversification."

There are many factors showing against the future of the dollar as world reserve currency. In this paper pays attention to futureofdollar.com the crucial points of the analysis after conducting extensive research on the subject.

Part I

Weak fundamentals of the U.S. economy

Nobel laureate Paul Krugman said that "a country whose fundamentals are consistently and predictably deteriorating currency crisis will necessarily [] at some point." (1)

1. Public debt

In mid-February 2010, Obama passed the bill raising the ceiling on public debt of 12.394 billion dollars to 14.294 billion dollars. This is a second increase of the upper limit of the national debt in less than two months.

The last time in December, Majority Leader Steny Hoyer House has said Congress had simply no choice: if the U.S. were to default on their debt obligations which would be a new disaster for the financial markets. (2)

"The financial management of the U.S. Treasury estimated that the total obligations of the Government of the United States exceeded 90 billion dollars," David Ross Radiant Asset Management said in its research. (3) They include hospital insurance, supplementary medical insurance and social security. "[T] he collected money (which borrowed Treasury and Congress has passed) falls far short of what is needed to fulfill the long-term obligations of these programs, even if it had not been spent . Nearly all the $ 90 billion promised obligations are no established method of payment. "(4)

"Including unfunded liabilities, the movement of U.S. 1, well above Taiwan and Zimbabwe, for the highest debt / GDP United States ... total debt plus unfunded obligations Total 625% of GDP. (5)

The Pew Commission on budget reform Peterson said that "the United States would almost certainly experience a crisis of debt leads," that "could take place gradually or it can happen suddenly, but with high costs anyway. "" The excessive debt ... Citizens would affect their daily lives by harming the U.S. standard of living through economic growth and slower wage dampening, and reduced capacity Government to cut taxes, invest, or provide a safety net. "(6)

2. Unemployment

This last February, the economy lost 36,000 jobs after losing 26,000 jobs in January and 109,000 jobs in December, and the unemployment rate remained at 9.7 percent. (7)

In January,.