WHERE IS THE US DDOLAR GOING?
The well known American economist Stephen Roach wrote a fairly long artical on Sept 27 2020 from which the folowing points are abstracted:
1) The cummulative US dollar is only going to fall faster and harder given the unprecedented erosion of domestic savings, an implosive current account deficit and the Fed determined to keep rates flat and near zero. EXPECT THE DOLLAR TO PLUNGE BY AS MUCH AS 35% NEXT YEAR.
2) There are 3 considerstions:
a) the rapid deterioration in macroeconomic imbalances in the United States
b) the ascendancy of the Euro and Renminbi as alteratives and
c) the end of the aura of American exceptionalism that has given the dollar teflon-like resilience for most of the post World War 1 era
3) In short, the vice is tightening on a still overvalued dollar. Domestic savings are plunging as never before, and the current-account balance is following suit. Don't expect the Fed, which has decided to focus more on supporting equities and bond markets than on leaning against inflation, to save the day. THE DOLLAR'S DECLINE HAS ONLY JUST BEGUN!!
AGAINST THE DECLINING TREND OF THE DOLLAR(assume it is the case), INVESTORS CAN EXPECT A SIGNIFICANT RISE OF THE GOLD PRICE. (all emphasis are mine)