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Showing posts from February, 2018

It Is a Good Thing Trump Asked About Strong or Weak Dollar

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This article was first published by me on Talkmarkets: http://www.talkmarkets.com/content/economics--politics-education/its-a-good-thing-that-trump-is-asking-about-strong-or-weak-dollar?post=121693&uid=4798

Despite press coverage to the contrary, it is actually a good thing that Donald Trump asked national security adviser, Mike Flynn, about the benefits of a weak dollar versus a strong dollar for the US economy. He asked the wrong guy, but at least his question is extremely relevant because of economic stands he has taken or may take in the future. Trump wants the American worker to rebound, economically. So the question is an important one. I believe there is a specific reason Donald Trump asked the question and I share it at the end of this article. The question is important is because Trump wants our exports to succeed. That would require a somewhat weak dollar compared to other currencies. But he wants a strong dollar to strengthen the buying power of the American worker. Th…

Scarcity and the Hoarding of Bonds as Gold in Repo

This article was first published by me on Talkmarkets: http://www.talkmarkets.com/content/bonds/scarcity-and-the-hoarding-of-bonds-as-gold-in-repo?post=120923&uid=4798

Understanding how the repo market works has been covered by multiple online websites, including Talkmarkets, so there are a few repo centered websites listed towards the end of this article that would be helpful to readers interested in the subject. Most quotations below except the discussion concerning the New York Federal Reserve Bank, come from a very helpful British repo educational website, Treasurers.org.

Repo is used by central banks, pension funds, sovereign wealth funds, money markets, insurance companies, banks, hedge funds, at bond auctions, in underwriting bonds, in secondary markets, etc. Before getting into basic issues with repo, we can see that bond yields trend lower in good times and bad, and bond demand in repo markets plays a big part in that demand.

The pressing question regarding the repo mark…

Cross Border Fake Helicopter money Unlike Real HM.

Donald Trump can tax American corporations who make products outside the US for sale in the US. But Donald Trump should not have to engage in a messy and dangerous trade war with Germany and China. Those trade wars would accomplish one thing, causing US goods to be cheaper as a weaker dollar would offset some tariff action by those two currency manipulators. But there are other ways of leveling out the playing field.

Germany manipulates currency by being in the Eurozone. If it didn't have the Eurodollar, its products would be more expensive as exports to the US. And China, which is still growing, likely still has a currency that is undervalued based on its economic clout and size versus the world. There is a solution, and some have said it is already in existence. But maybe it just looks like helicopter money.

Helicopter Money is a much easier way to increase the money supply, put more money in the hands of Americans and lower the dollar some, so that our products would be cheape…