I am in cash right now because the dollar is the world reserve currency and as assets are liquidated the dollar will rise. Once this liquidation process is over, we will see the quote come into play. If the dollar wasn’t the reserve currency we would be seeing our currency getting crushed. I have the ability because of foreign holdings to move my money to any currency or asset very quickly. I am just in the dollar right now because of short term timing. I don’t plan on being there by the end of next year.
To answer your first question, I think it is pretty clear now that there will be no voluntary abandonment. We are going to be forced and it will come in the form of a bond market dislocation. Followed after that by the dollar crashing hard. At least that is my current thesis.
