iShares Silver Trust Message Board
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Why Silver Will Crash in Fiscal Cliff Dive
"Why do people think the Fiscal Cliff and Debt Ceiling will weaken the Dollar and push up precious metals? Its the exact opposite. The Fiscal Cliff is higher taxes, significant budget cuts (including Defense), and elimination of stimulus (unemployment back to 26 from 100 weeks, FICA back to 8% vs 6%). That means more money being taken out of the economy and less going in. And much less borrowing by the Treasury. This will decrease the budget deficit by $350 Billion in the first year and actually make the Dollar stronger (PMs weaker). This combination will take atleast 2.0% off GDP and push us into recession. Recession means lower annual Dollar turns and higher Dollar valuations. The best Congress can possibly do is cut that in half ... but is still makes for a significantly stronger Dollar."
Posted by Enor1960-
Crash is Just getting started
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Easy to understand
- 1 Reply to ext4r
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very simple economics
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Commodities demand will plummet
- 1 Reply to ext4r
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Simple economics
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The "Fiscal Cliff" is really a spending cliff.... If congress doesn't reach agreement within the next month, then the budget automatically gets cut and that will KILL commodities demand.
- 1 Reply to ext4r
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commodities prices will plummet
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Government spending cuts are coming and that will further kill commodities demand.
- 1 Reply to ext4r
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Cuts in spending leads to crashing commodities demand
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Cuts in spending will kill commodities demand.... raising taxes will send the US dollar higher.
- 1 Reply to ext4r
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Silver is in big trouble
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easy economics
- 1 Reply to ext4r
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very important to understand why silver and other commodities will collapse
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Either way the government has built in obligations and, because they can, will continue printing money out of thin air to meet them. Especially with Obama as president. they will not cut the programs that get them reelected even when they don't deserve to be reelected. In fact in difficult times they will expand those programs rather than take the political hit. Obama left the Americans in Benghazi to die without adequate security forces and a not up to specs compound because Obama didn't want to backtrack on his statement that Al Qaeda is on the run. Obama is adverse to taking responsibility for any politically negative occurrence.Speed up the presses will be the rally cry from the White House.
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One way, or the other, taxes will be raised and spending will be cut..... That will strengthen the dollar and send commodities including oil and silver plummeting.
- 2 Replies to ext4r
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No matter what they do, the US dollar will gain strength. If they do nothing, it will gain because of automatic spending cuts and automatic higher taxes
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You're in for a world of hurt.
Sentiment: Buy
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Fiscal cliff won't happen. Government continues printing more money.
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