That includes me, and the just departed Barkley, of course, and with much more justification.
But the issue is perhaps now that the dollar no longer looks a safe store of value over at least the coming six months relative to the euro, will that bring into play amplifying factors, which will intensify the fall of the dollar?
One commentary I have heard which sounded sober, is that much of the inward capital investment into the USA has come from Europe, and this is not actually very speculative, and not necessarily immediately going to switch back to the euro. The argument is that this movement has been largely the result of the growth of mutual funds in Europe, as a result of the squeeze on existing social pension provisions, and these mutual funds routinely have a proportion of their investment in the USA. And by implication mutual funds take a long view and are a stabilising factor in the workings of global finance capitalism.
Any comments? Do we expect the fall of the dollar to be exponential as a result of some feedback mechanism reinforcing its demise, or will it just adjust a little more to the euro?
Chris Burford
London