The $US Dollar, the Ultimate Falling Knife?

The gold bugs like to play cute and say, “The price of gold isn’t up. The price of the $US dollar is down”, and they bet its decline will continue, because of another truism: “You can’t print ‘money’. You can only print ‘currencies’.”

Before 1971, you could argue that the $US was both a currency and money. But that argument can’t be made today now that the $US dollar is backed by nothing but military threats and now that its role in trade settlements is increasingly declining.

One direct way to short the $US is to go long UDN. Indirect ways are to go long gold, or currencies like the Franc, the Euro or the Yen, or to rotate into hard assets. In short, lots of investing/trading choices.

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