Tuesday, June 15, 2010

If You Can Believe This...

It may be hard to believe, but even with our multi-million dollar oil spill (Kevin Costner to the rescue!), government bailouts, poor municipal investing and rapidly rising Gross National Debt we, meaning the American dollar, are still the best game in town. The problems in Europe and Greece have made the Euro too shaky to count on, so countries like China, Japan, Venezuela, Iraq, Iran, Saudi Arabia (?) and a good part of Europe feel that buying (yes, buying) U.S. Debt is more stable. As it is now, the 10-year yield on the U.S. dollar is a mere 3.25%, which, when compared to the non-existent yield on the Euro, sounds like a pretty good chunk of change. This low yield is a response to the U.S. debt issue and there is no foreseeable rise in sight. So what does this mean? The naysayers of the Euro (the ones who claimed that creating a single currency was only a “quick” fix to a difficult solution) were right, and that with all of our problems, the U.S. dollar is continuing to hold its place as the world’s reserve currency.

Thoughts?

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