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[quote=socrattt]I have a quick question for any of you gurus. If the dollar continues its’ free fall, how will that affect the oil prices? Wouldn’t the cost of oil essentially increase?

What is the short and long term possibilities that Euro becomes the new currency of oil trade? I am a bit curious to see what happens as I believe there has to be some sort of dramatic overhaul of how oil is bought sold due to the current volatility of the US Dollar.[/quote]

In think the relationship between oil and the dollar is inverse. Rather it’s oil that affects the dollar more than the other way round, hence the term the ‘oil standard’ or Petrodollars, but I forget how this works now. Basically OPEC countries sell oil for dollars which they then use to buy US treasuries. I don’t see a wholesale flight to Euro’s. Recently, we’ve seen a flight to dollars when panic hit the markets, so investors obviously still see the dollar as a safe(r) bet. How long that will last, will possibly depend on Asia’s confidence in the US ability to bring back some stability the to the markets.

[34f3f3f]

[quote=socrattt]I have a quick question for any of you gurus. If the dollar continues its’ free fall, how will that affect the oil prices? Wouldn’t the cost of oil essentially increase?

What is the short and long term possibilities that Euro becomes the new currency of oil trade? I am a bit curious to see what happens as I believe there has to be some sort of dramatic overhaul of how oil is bought sold due to the current volatility of the US Dollar.[/quote]

In think the relationship between oil and the dollar is inverse. Rather it’s oil that affects the dollar more than the other way round, hence the term the ‘oil standard’ or Petrodollars, but I forget how this works now. Basically OPEC countries sell oil for dollars which they then use to buy US treasuries. I don’t see a wholesale flight to Euro’s. Recently, we’ve seen a flight to dollars when panic hit the markets, so investors obviously still see the dollar as a safe(r) bet. How long that will last, will possibly depend on Asia’s confidence in the US ability to bring back some stability the to the markets.

[34f3f3f]

[quote=socrattt]I have a quick question for any of you gurus. If the dollar continues its’ free fall, how will that affect the oil prices? Wouldn’t the cost of oil essentially increase?

What is the short and long term possibilities that Euro becomes the new currency of oil trade? I am a bit curious to see what happens as I believe there has to be some sort of dramatic overhaul of how oil is bought sold due to the current volatility of the US Dollar.[/quote]

In think the relationship between oil and the dollar is inverse. Rather it’s oil that affects the dollar more than the other way round, hence the term the ‘oil standard’ or Petrodollars, but I forget how this works now. Basically OPEC countries sell oil for dollars which they then use to buy US treasuries. I don’t see a wholesale flight to Euro’s. Recently, we’ve seen a flight to dollars when panic hit the markets, so investors obviously still see the dollar as a safe(r) bet. How long that will last, will possibly depend on Asia’s confidence in the US ability to bring back some stability the to the markets.

[34f3f3f]

[quote=socrattt]I have a quick question for any of you gurus. If the dollar continues its’ free fall, how will that affect the oil prices? Wouldn’t the cost of oil essentially increase?

What is the short and long term possibilities that Euro becomes the new currency of oil trade? I am a bit curious to see what happens as I believe there has to be some sort of dramatic overhaul of how oil is bought sold due to the current volatility of the US Dollar.[/quote]

In think the relationship between oil and the dollar is inverse. Rather it’s oil that affects the dollar more than the other way round, hence the term the ‘oil standard’ or Petrodollars, but I forget how this works now. Basically OPEC countries sell oil for dollars which they then use to buy US treasuries. I don’t see a wholesale flight to Euro’s. Recently, we’ve seen a flight to dollars when panic hit the markets, so investors obviously still see the dollar as a safe(r) bet. How long that will last, will possibly depend on Asia’s confidence in the US ability to bring back some stability the to the markets.

[34f3f3f]

[quote=socrattt]I have a quick question for any of you gurus. If the dollar continues its’ free fall, how will that affect the oil prices? Wouldn’t the cost of oil essentially increase?

What is the short and long term possibilities that Euro becomes the new currency of oil trade? I am a bit curious to see what happens as I believe there has to be some sort of dramatic overhaul of how oil is bought sold due to the current volatility of the US Dollar.[/quote]

In think the relationship between oil and the dollar is inverse. Rather it’s oil that affects the dollar more than the other way round, hence the term the ‘oil standard’ or Petrodollars, but I forget how this works now. Basically OPEC countries sell oil for dollars which they then use to buy US treasuries. I don’t see a wholesale flight to Euro’s. Recently, we’ve seen a flight to dollars when panic hit the markets, so investors obviously still see the dollar as a safe(r) bet. How long that will last, will possibly depend on Asia’s confidence in the US ability to bring back some stability the to the markets.

[34f3f3f]

Calculated Risk is good but quality of comments not so good. Here’s a very good one http://www.blogrunner.com/ and LA Times does a good one too http://latimesblogs.latimes.com/laland/

[34f3f3f]

Calculated Risk is good but quality of comments not so good. Here’s a very good one http://www.blogrunner.com/ and LA Times does a good one too http://latimesblogs.latimes.com/laland/

[34f3f3f]

Calculated Risk is good but quality of comments not so good. Here’s a very good one http://www.blogrunner.com/ and LA Times does a good one too http://latimesblogs.latimes.com/laland/

[34f3f3f]

Calculated Risk is good but quality of comments not so good. Here’s a very good one http://www.blogrunner.com/ and LA Times does a good one too http://latimesblogs.latimes.com/laland/

[34f3f3f]

Calculated Risk is good but quality of comments not so good. Here’s a very good one http://www.blogrunner.com/ and LA Times does a good one too http://latimesblogs.latimes.com/laland/

[34f3f3f]

[quote=schizo2buyORnot] Read . . . if you have all your money in cash and are sitting in cash because the sky is continuing to fall you are in one of the worst most risky investments you can be in. Thats right . . . those that have their money in a bank so it is “safe” are going to get screwed. Buy RE, buy oil stocks, buy mining stocks, buy Chinese stocks, but gold, I don’t care. Don’t stay liquid in US dollars however. My original post stands . . . SD RE in US Dollars will cost more US Dollars in Aug. 09 . . . largely because the US dollar is going to hell in a hurry.[/quote]

I really want to believe this. I really do! But the recession fear is indelibly embedded in the US psyche. It took a long time to get there, and I suspect will take as long to build confidence back into the system. This is as much about a crisis of confidence as applied economics. Moreover, there are a lot of delayed reactions that need to filter through the system, before a recovery becomes evident. You can’t dismiss the argument that squirting the same old lighter fluid onto the flames won’t get a lot of heads shaking. Trying to predict the actual month a turn around will occur is a little whimsidaisical. I agree, being in cash is a concern, but I’d personally still prefer to be in it, and the negligible risk it entails, while still renting than in an over-inflated asset, that carries with it so many additional costs. If the US, and California especially cannot fix this problem of fundamentals in pricing, which has a knock on effect in costs overall, than it will be time to move on. You can’t just focus on housing all the time. Health care, social security, global warming, growing global populations, scarcity of resources, and energy are all part of what is to come. So even if housing eventually bounces back, the winners will only be those who have been watching the horizon. Be sensible, patient, and not greedy. The latter in particular will become an anachronism, but dint of necessity.

[34f3f3f]

[quote=schizo2buyORnot] Read . . . if you have all your money in cash and are sitting in cash because the sky is continuing to fall you are in one of the worst most risky investments you can be in. Thats right . . . those that have their money in a bank so it is “safe” are going to get screwed. Buy RE, buy oil stocks, buy mining stocks, buy Chinese stocks, but gold, I don’t care. Don’t stay liquid in US dollars however. My original post stands . . . SD RE in US Dollars will cost more US Dollars in Aug. 09 . . . largely because the US dollar is going to hell in a hurry.[/quote]

I really want to believe this. I really do! But the recession fear is indelibly embedded in the US psyche. It took a long time to get there, and I suspect will take as long to build confidence back into the system. This is as much about a crisis of confidence as applied economics. Moreover, there are a lot of delayed reactions that need to filter through the system, before a recovery becomes evident. You can’t dismiss the argument that squirting the same old lighter fluid onto the flames won’t get a lot of heads shaking. Trying to predict the actual month a turn around will occur is a little whimsidaisical. I agree, being in cash is a concern, but I’d personally still prefer to be in it, and the negligible risk it entails, while still renting than in an over-inflated asset, that carries with it so many additional costs. If the US, and California especially cannot fix this problem of fundamentals in pricing, which has a knock on effect in costs overall, than it will be time to move on. You can’t just focus on housing all the time. Health care, social security, global warming, growing global populations, scarcity of resources, and energy are all part of what is to come. So even if housing eventually bounces back, the winners will only be those who have been watching the horizon. Be sensible, patient, and not greedy. The latter in particular will become an anachronism, but dint of necessity.

[34f3f3f]

[quote=schizo2buyORnot] Read . . . if you have all your money in cash and are sitting in cash because the sky is continuing to fall you are in one of the worst most risky investments you can be in. Thats right . . . those that have their money in a bank so it is “safe” are going to get screwed. Buy RE, buy oil stocks, buy mining stocks, buy Chinese stocks, but gold, I don’t care. Don’t stay liquid in US dollars however. My original post stands . . . SD RE in US Dollars will cost more US Dollars in Aug. 09 . . . largely because the US dollar is going to hell in a hurry.[/quote]

I really want to believe this. I really do! But the recession fear is indelibly embedded in the US psyche. It took a long time to get there, and I suspect will take as long to build confidence back into the system. This is as much about a crisis of confidence as applied economics. Moreover, there are a lot of delayed reactions that need to filter through the system, before a recovery becomes evident. You can’t dismiss the argument that squirting the same old lighter fluid onto the flames won’t get a lot of heads shaking. Trying to predict the actual month a turn around will occur is a little whimsidaisical. I agree, being in cash is a concern, but I’d personally still prefer to be in it, and the negligible risk it entails, while still renting than in an over-inflated asset, that carries with it so many additional costs. If the US, and California especially cannot fix this problem of fundamentals in pricing, which has a knock on effect in costs overall, than it will be time to move on. You can’t just focus on housing all the time. Health care, social security, global warming, growing global populations, scarcity of resources, and energy are all part of what is to come. So even if housing eventually bounces back, the winners will only be those who have been watching the horizon. Be sensible, patient, and not greedy. The latter in particular will become an anachronism, but dint of necessity.

[34f3f3f]

[quote=schizo2buyORnot] Read . . . if you have all your money in cash and are sitting in cash because the sky is continuing to fall you are in one of the worst most risky investments you can be in. Thats right . . . those that have their money in a bank so it is “safe” are going to get screwed. Buy RE, buy oil stocks, buy mining stocks, buy Chinese stocks, but gold, I don’t care. Don’t stay liquid in US dollars however. My original post stands . . . SD RE in US Dollars will cost more US Dollars in Aug. 09 . . . largely because the US dollar is going to hell in a hurry.[/quote]

I really want to believe this. I really do! But the recession fear is indelibly embedded in the US psyche. It took a long time to get there, and I suspect will take as long to build confidence back into the system. This is as much about a crisis of confidence as applied economics. Moreover, there are a lot of delayed reactions that need to filter through the system, before a recovery becomes evident. You can’t dismiss the argument that squirting the same old lighter fluid onto the flames won’t get a lot of heads shaking. Trying to predict the actual month a turn around will occur is a little whimsidaisical. I agree, being in cash is a concern, but I’d personally still prefer to be in it, and the negligible risk it entails, while still renting than in an over-inflated asset, that carries with it so many additional costs. If the US, and California especially cannot fix this problem of fundamentals in pricing, which has a knock on effect in costs overall, than it will be time to move on. You can’t just focus on housing all the time. Health care, social security, global warming, growing global populations, scarcity of resources, and energy are all part of what is to come. So even if housing eventually bounces back, the winners will only be those who have been watching the horizon. Be sensible, patient, and not greedy. The latter in particular will become an anachronism, but dint of necessity.

[34f3f3f]

[quote=schizo2buyORnot] Read . . . if you have all your money in cash and are sitting in cash because the sky is continuing to fall you are in one of the worst most risky investments you can be in. Thats right . . . those that have their money in a bank so it is “safe” are going to get screwed. Buy RE, buy oil stocks, buy mining stocks, buy Chinese stocks, but gold, I don’t care. Don’t stay liquid in US dollars however. My original post stands . . . SD RE in US Dollars will cost more US Dollars in Aug. 09 . . . largely because the US dollar is going to hell in a hurry.[/quote]

I really want to believe this. I really do! But the recession fear is indelibly embedded in the US psyche. It took a long time to get there, and I suspect will take as long to build confidence back into the system. This is as much about a crisis of confidence as applied economics. Moreover, there are a lot of delayed reactions that need to filter through the system, before a recovery becomes evident. You can’t dismiss the argument that squirting the same old lighter fluid onto the flames won’t get a lot of heads shaking. Trying to predict the actual month a turn around will occur is a little whimsidaisical. I agree, being in cash is a concern, but I’d personally still prefer to be in it, and the negligible risk it entails, while still renting than in an over-inflated asset, that carries with it so many additional costs. If the US, and California especially cannot fix this problem of fundamentals in pricing, which has a knock on effect in costs overall, than it will be time to move on. You can’t just focus on housing all the time. Health care, social security, global warming, growing global populations, scarcity of resources, and energy are all part of what is to come. So even if housing eventually bounces back, the winners will only be those who have been watching the horizon. Be sensible, patient, and not greedy. The latter in particular will become an anachronism, but dint of necessity.

[Author]

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