Bottom line: The US Dollar is in a very precarious situation and when we combine our Gvt's excessive monetary printing (to offset a deflationary economy) with a total loss of international confidence in the world's reserve, the dollar WILL FALL (mid-long term) - causing our cost of living to significantly rise and our standard of living to fall (precipitously) - ultimately leading to a hyperinflationary depression.
Excerpt below from my 2006 post - American Wakeup Call:
Ultimately, this adjustment of the dollar will be painful for the world, and the average American’s standard of living will suffer significantly (much lower). Many Americans will become unemployed early on, but those who live through this era will eventually be put back to work and things will begin to get better… However, the trivial issues we concern ourselves with today (Politics, American Idol, Survivor, keeping up with the Jones’, etc) will no longer be the forefront of our daily lives, as we struggle to keep food on the table and a roof over our heads. The ACLU-type concerns of today will also become irrelevant and family values/religion will become the center-stage of the new America.
Another bright side to the issue: This dollar devaluation will allow the United States to eliminate much of its foreign debt and American citizens will demand that our government leaders LEAD (rather than today’s sickening ego power plays, rampant corruption and partisan politics). Welfare will probably become a thing of the past, and people will have to work to earn an honest days pay. Companies and the Government will again start to invest in infrastructure, American expectations will begin to rise, factories will once again start to billow smoke, and ultimately, our country will be competitive in the world once again…
I personally believe it will be a long, very difficult ride ahead, but in the end, it will probably make us a better, stronger nation. We, as a people, have become way too self-centered and soft, trivial issues have become important, important issues are ignored, people are completely ignorant to the world, values are gone, family means little, government is completely out of touch and ineffective, everyone wants something for nothing, etc. This wake-up call will probably do us some good.
Another relevant article if interested: Dollar: Faltering foundation of US Economic Strength
One more link as "food for thought": Social Consequences of an Economic Meltdown