More on the Dollar Crisis.

[FloridaPat]

http://home.earthlink.net/%7Elrgoldner/dollarcrisis.html

" Incredible as it may sound, ever since the late 1950’s, the world economy has been tossing around a “hot potato” of an ever-increasing mass of “nomad dollars” (dollars held outside the U.S.) whose actual conversion into tangible wealth would plunge the world into a deflationary crash. Even now, few people are aware of the extent to which this “technical” question of “economics” (and in reality a profoundly social question) has in fact cadenced 45 years of world history, erupting into view in key years such as 1968 (dollar convertibility crisis), 1973 (end of the Bretton Woods System), 1979 (runaway global inflation, gold at $850 an ounce) 1990 (Japanese deflation) or 1997-98 (Asia crisis, Russian default, “hedge fund” crisis). We are clearly today at another key turning point, and perhaps (over the next few years) at the long-delayed culmination of the whole story, when that mass of dollars, now grown to gargantuan proportions (the $30 billion of 1958 have become at least $11 trillion today) will be deflated, one way or another.
With the election safely behind it, the Bush administration in the U.S. can now get on with the world economic crisis that has been stalking it ever since it came to power, in the wake of the stock market crash of spring 2000. Bush and his people must move as quickly as possible to get the “worst” over with, in their own terms (terms distorted by their own illusions of being in control of events).before they have to face new elections or other political challenges. (Had Kerry won, his incoming government might well be facing a worse crisis, compounded by international “uncertainty” over various policies.) In recent weeks, the “dollar” crisis, which is merely the immediate visible face of a profound social and economic crisis in progress for decades, has moved (once again) from technical discussions of a marginal coterie of specialists to center stage in the media. Prominent pro-capitalist economists such as Steve Roach and Paul Krugman are now saying that a major crisis is almost inevitable, more a question of when than if. This is particularly revealing in light of the fact that in eight or nine months of almost constant media huffing and puffing about the election, this reality and the issues it raises were precisely nowhere in the discussion. Ever since the 1960’s, when the problematic international status of the dollar became an ongoing “policy” question (with its ebbs and flows) no mainstream American politician has ever gone anywhere near it. It is more of a political “third rail” than Social Security or Medicare (1)"

[rodeodance]

1. "nomad' dollars--interesting concept