indicators that suggest a bottom, page-103

"Add to that the fact that many countries are now going to experience problems with national debt with the rise in the value of the US {they borrowed in US Dollars} and well, I think you get the picture."

The reason the US$ is going up is that all (many) loans taken out in US$ are being paid off. I posted a piece on another thread.

Looks like Depression so be prepared.

"Understanding The Global Financial Crisis:
This, in basic terms, is what happened to the main currency in use for all this, the US Dollar, during the prolonged credit expansion which is now ending. All through the credit expansion, the US Dollar fell in global value. It was the currency being sold in order to buy other assets with the borrowed money.

NOW, though, the entire global system is deleveraging - it is deflating. In order to do this, to repay debts owed, the currency with which to repay must first be bought. This is the key to understanding why the US Dollar is not only climbing in value internationally, it is soaring upwards.

The investors who are now deleveraging have first sold their stocks, their commodity positions et al. Look at the current prices for all this. With the realised money in hand, they are buying US Dollar in order to repay current debts. They are deleveraging their balance sheets - rebalancing to lower debts.

The fatal problem is that as they do this and in the act of repaying their outstanding loans - they are DEFLATING (contracting) the total quantity of credit money in the banking and financial system. A credit contraction is one thing, it causes recession. A credit DEFLATION - a real contraction in the total amount of credit money in use - is an entirely different monetary animal. It causes depression.

This climbing danger of a literal credit money deflation was what the Europeans decided to act against on Monday, October 13 when they laid out 1.7 TRILLION Euros for the continental financial system! This is the money with which they want to ensure that the European financial system will not fall."

©2008 - The Privateer
http://www.the-privateer.com
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(reproduced with permission)