Bloomberg: U.S. dollar is “one step nearer” to crisis says Yu Yongding - former adviser to China’s central bank.
Any appreciation of the dollar is “really temporary” and a devaluation of the currency is inevitable as U.S. debt rises, Yu said in a speech in Singapore today.
“Such a huge amount of debt is terrible,” Yu said. “The situation will be worsening day by day. I think we are one step nearer to a U.S. dollar crisis.”
Yu also said China is worried about the safety of its foreign-exchange reserves including those invested in U.S. Treasuries as the U.S. currency weakens, reiterating his earlier views on the dollar assets.
U.S. Treasuries fail to provide safety or liquidity in managing China’s $2.45 trillion foreign-exchange reserves, Yu said in an e-mail in August. To help cool demand for the securities, China needs to curb the growth of its foreign reserves by intervening less in the currency market, he said.
China should reduce its holdings of U.S.-dollar assets to diversify risks of “sharp depreciation,” Yu said in July. The nation should convert some holdings in U.S. dollars into assets denominated in other currencies, commodities and direct investments overseas, he wrote in a commentary in the China Securities Journal.
The U.S. House of Representatives is due to vote tomorrow on legislation pressing China to raise the currency’s value amid assertions the yuan is undervalued and gives the Asian nation a trade advantage. The legislation would let companies petition for higher duties on Chinese imports. (My Comment - Can you say trade war?)
The Street: Spot Gold Prices Pop as Investors Eye $2,500
Spot gold prices were exhibiting greater strength Tuesday afternoon as gold investors began eyeing $2,500 and higher gold prices following the precious metal's $1,300 achievement.
"Gold prices are now moving through $1,300 and it's the beginning of the road to $2,500 gold prices and beyond, James DiGeorgia, publisher of the 'Gold and Energy Advisor' and author of 'The Trader's Great Gold Rush' said in a note. DiGeorgia for one is eying $1,400 to $1,500 gold prices by the end of the year, $2,500 shortly after that and maybe even $5,000 in the near future.
DiGeorgia is among many gold investors who are concerned about an eventual collapse in the U.S. dollar and foresee a resulting flight to safety via gold and other precious metals. "Even as the dollar is sinking after decades of continuous inflation, even as foreign governments and local economists alike are recognizing that America is insolvent and broke, the printing presses are being cranked up," he said.
AP: Weddings in 2009 at record 100-yr low
WASHINGTON — As the recession shook Americans' confidence last year, new figures show that weddings for people 18 and older dropped to the lowest point in over a hundred years.
A broad array of new Census Bureau data released Tuesday documents the far-reaching impact of a business slump that experts say technically ended in June 2009: a surging demand for food stamps, considerably fewer homeowners and people doubling up in housing to save money.
"Given the scope of the recent recession, many more couples are likely to choose cohabitation over marriage in the coming years," said Mark Mather, associate vice president of the Population Reference Bureau.
On the positive side: Americans spent about 36 minutes fewer minutes in the office per week and were stuck in less traffic, although the reason was largely because millions of them had lost jobs or were scraping by with part-time work. (My comment - and this is considered good news? LMFAO)
Washington Post: As 44 million Americans live in poverty, a crisis grows
Forty-four million Americans (one in seven citizens) are now living below the poverty line -- defined as just $22,000 in annual income for a family of four - more than at any time since the Census Bureau began tracking poverty 51 years ago.
19 million people are now living in "extreme poverty," which is under 50 percent of the poverty line, or $11,000 for a family of four. "That means over 43 percent of the poor are extremely poor," said Edelman, who served as an aide to Sen. Robert Kennedy (D-N.Y.) and in the Clinton administration. That's over 6 percent of the population, and that figure has just been climbing up and up."
Edelman says that the number of people living at less than two times the poverty line ($44,000 for a family of four) is equally significant.
"Data shows that's really the line between whether or not you can pay your bills," said Edelman. "That number has reached 100,411,000 people. That's 33 percent of the country. That's the totality of the problem -- whether you call it poverty or not."