World’s Major Convertible Currencies Priced on the Manure Standard

Laurence Copeland is the author of an article titled, “Waiting for the Next Shoe to Drop” and is professor of finance at Cardiff University Business School. The opinions expressed are his own and do not constitute investment advice.

A few of his colorful but all too true quotes from the article are as follows:

1. How can you fail to be pessimistic when the world economy is still dominated by the U.S. – a basket case, becoming weaker every day, with a political class too blind or too scared to admit in public the obvious fact that the country cannot carry on living beyond its means?

2. The Americans remain in denial, with monetary and fiscal authorities primed to pick up any slack created by U.S. consumers unable to make their mortgage repayments and maxed out on their credit cards.

3. As long as the markets continue to see the dollar as a safe haven, it remains strong and U.S. competitiveness suffers accordingly, making it impossible to generate the export-led recovery the U.S. so desperately needs.

4. First, remember that, with the exception of the Canadian and Australian dollars, and Swiss franc, all the world’s major convertible currencies are priced on the Manure Standard: the dollar is viewed as slightly higher grade organic fertilizer than the euro, the yen is somewhat less disgusting than the dollar.

5. All are malodorous to a degree which would have made them near-worthless only a few years ago. No wonder gold – useless, but odourless – is riding high. If I am right, it has far further to go.

To review the entire article “Waiting for the Next Shoe to Drop” and to gain some insight as to just how clueless the Obama administration is about the probable disaster to come go to Shoe to Drop