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November 9, 2007 at 07:54:22

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Oops

by Stephen Pizzo Page 2 of 2 page(s)

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If the US economy were a patient here is how their chart would read between appointments.

A Comparison of Currencies and Commodities
from the beginning of the Bush administration with values as of 11/7/07

If you don't already understand, all those numbers tell the same story. Oil is not reaching for $100 a barrel because oil is worth anything close to that. It's because the US dollar is falling in value and oil producers, while slippery little bastards, are not stupid. They aren't about to let the US buy their oil with cheaper and cheaper dollars. So they are demanding more bucks for a barrel. Eventually they will do as China is about to do, detach the value of their products and currencies from the value of the US dollar. When that process is complete the US dollar will find itself

The other currencies are a reflection of the same thing.

Gold is more complicated. Gold prices are a measure of two things at once: the value of the dollar and fear. When gold goes up so fast and so far it's because some of the smartest financial minds in the world see a storm coming. The higher gold goes the lower their financial barometer must be reading.

If the numbers in the table above reflected instead the 7th year of a Democratic administration, what do you think those big-talking, arrogant, father-knows-best GOP types would be saying right now? Do you think they'd be just shrugging it off with a, "well, you know, stuff happens?"

I don't think so. Stuff did happen though, and lots of it. And we don't need DNA analysis to know whose stuff it is that's about to hit the fan.

Duck and cover my friends.

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Stephen Pizzo has been published everywhere from The New York Times to Mother Jones magazine. His book, Inside Job: The Looting of America's Savings and Loans, was nominated for a (more...)

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