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04.21 Trump and impeachment: where Democrats stand after Mueller

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04.21 We’re altering the climate so severely that we’ll soon face apocalyptic consequences. Here are 9 last-ditch ways we could hack the planet to reverse that trend.[Hail Mary pass ideas]

04.18 'We Can Be Whatever We Have the Courage to See': New Video From AOC Envisions a #GreenNewDeal Future [7:35 video]

04.18 'Decades of denial': major report finds New Zealand's environment is in serious trouble

04.17 Thawing Permafrost Emitting Higher Levels of Potent Greenhouse Gas Than Previously Thought: Study

04.16 'That Backfired': Watch Bernie Sanders Counter Right-Wing Talking Point, Make Case for Medicare for All on Fox News

04.16 Cause of cancer is written into DNA of tumours, scientists find, creating a 'black box' for origin of disease

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04.15 What It Was Like to Have a Baby in Sweden

04.14 'Shut the country down': British climate group Extinction Rebellion heads to US

04.13 With Youth Climate Actions Backed by Leading Experts, Latest Round of Protests Highlights Call for Bold and Urgent Action

04.11 Will You Rise Up for Climate Justice Next Week? Don’t Let Fatalism and Cynicism Hold You Back

04.11 300+ Groups to Congress: #GreenNewDeal 'Must Transform Our Food System and Revitalize Rural America'

04.10 Glaciers and arctic ice are vanishing. Time to get radical before it's too late [Willfully ignorant "conservatives" and corporately-bribed liberals diddle self-obsessively while life on earth dies]

04.10 Is there a beautiful, briny solution to the world’s clean water crisis?

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04.08 Himalayan glaciers on the eve of destruction

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04.23 'A Really Exciting Proposal': Elizabeth Warren's Education Overhaul Would Wipe Out Student Debt, Provide Free Public College

04.23 To Reassert Congressional War Authority, Sanders Demands Vote to Override Trump Veto on Yemen


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04.21 Pentagon Spending Set to Hit Near-Record Levels, But 'Establishment Says We Can't Afford' Progressive Policies

04.19 14 Must-Read Moments From the Mueller Report

04.19 No One Listens to the President

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04.19 Mueller report: press secretary Sarah Sanders admitted to lying to reporters

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04.23 The “disintegration” of global capitalism could unleash world war 3, warns top EU economist

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04.19 The Public Banking Revolution Is Upon Us

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04.23 To stop global catastrophe, we must believe in humans again

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04.21 Decrying 'Toxic Alliance' of Macron and Polluters, Climate Campaigners Stage One of France's Largest Ever Acts of Civil Disobedience

04.21 Yellow Vests Demonstrate in Paris as Notre Dame Donations Highlight Wealth Inequality

04.21 The Observer view on the Mueller report: Trump is a disgrace not welcome in Britain

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  Thinking about Valuations
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Thinking about Valuations

by Fred Cederholm

All currencies today have nothing but a lick and a promise behind them.

I’ve been thinking about valuations. Actually I’ve been thinking about money, the US dollar, the US Treasury, the EURO, oil and gasoline, the stock (equity) markets, and Norway’s income and net worth listing. If you haven’t noticed, the US Dollar has dropped over the recent weeks. If what you purchase seems to cost more today than it did a month ago, I’d suspect that this is due to the fall of the Dollar relative to the other major currencies in the world.

You see, since we import so much of what we consume, we have to purchase these foreign goods, services, and foodstuffs with dollars converted into whatever currency is needed. Some countries are willing to accept Uncle $ugar’s buck for their goods, services and foodstuffs—but a growing number of nations is not so willing, and therein lies the rub. The US Dollar is still the reserve currency of planet Earth, but it is looking like its glory days may be over (or at least are being strongly questioned in the meeting rooms of the central banks around the globe). Over time, this shift/decline in relative valuations hit the Greeks, Romans, French, and English, and ended their position as the global money.

One major difference between the “then-dominant currencies” and now is that all currencies today have nothing but a lick and a promise behind them. This is true whether you are talking about Dollars, EUROs, the Yen, Pounds Sterling, Krona, Riyals, Rubles, Pesos, or Renminbis. There is no established weight of gold/silver behind any currency. Each country pretty much prints as much currency as it wants or needs. The valuation relative to other currencies depends on how the world perceives the “full faith and credit" of the issuing nation. Our government’s treasury is in the business of printing money.

The Dollar remains the world’s reserve currency only because there is no other one out there with enough printed “chits” to replace it.

The Buck has taken quite a ride in the past 70 years. The US may have lost its status of being the official currency of OPEC—despite the invasions, the wars, and/or the coup d’états staged by the US government to prolong that monopoly position. Still... the Dollar remains the world’s reserve currency only because there is no other one out there with enough printed “chits” to replace it. There are mega TRILLIONS of Dollars and dollar-denominated financial instruments. Therein rests the problem.

The Constitution of the United States is very specific as to who is responsible for the currency. The US Treasury is mandated to promote a strong currency for this nation. However, since the time of WWI, the Federal Reserve Banking system has been delegated the responsibility of printing the bucks. Since that fateful turnover of our money supply to “the Fed” under the administration of President Woodrow Wilson, the Dollar has lost roughly 93% of its purchasing power. The declines continue to this day.

The US Treasury no longer is committed to maintaining a strong dollar as its primary guiding mandate. The Treasury, and whichever retired partner from the investment banking firm of Goldman Sachs is serving as Treasury Secretary, is now focused on keeping Congress and the US Government "in money." (It should be noted that our present Treasury Secretary came from a research position at the Fed—not from Goldman Sachs.) The US has been running deficits in just about every category imaginable. Our National Debt now hovers around $12 TRILLION. We have funded our recent runs of conspicuous consumption by borrowing to buy anything we wanted—not just what we needed. Now that an economic downturn has pushed most households into buying only what they absolutely need, the credit has contracted. Foreign countries are now re-TH*NK*NG their blank check policies of continuing to loans US/us whatever we need to keep the ball rolling and the shoppers shopping. What will be the impact?

The Dollar has dropped so much of late that the EURO, which cost LESS that $ .80 (at its roll-out in 1999) now costs just OVER $1.50. This is an 87.5% change in valuation in just about 10 years. A barrel of crude oil on the world’s markets now is priced in the mid $80’s per barrel. A gallon of regular gasoline goes for $2.749 a gallon—up $ .20 in under two weeks. This change, and the recent blip in the equity markets, are due to erosion in the valuation of the Dollar, and not norms of supply and demand.

As the Obama Administration now completes 9/48ths of its first term of office, we are seeing the changes and fixes promised. The country appears to be “under-whelmed” by the policies... and then “overwhelmed” by the costs. The bailouts have gone to the few while the typical American family suffers. We were promised transparency, but just what have we gotten for the $1.4 TRILLION in one fiscal year’s added national debt? Norway has perhaps the only true transparency. That country just published what EVERY individual made (and was worth in 2008) in their respective local newspapers.

Hmmm... I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.

Copyright 2009 Questions, Inc. All rights reserved. Fred Cederholm is a CPA/CFE, a forensic accountant, and writer. He is a graduate of the University of Illinois (B.A., M.A. and M.A.S.). He can be reached at

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This story was published on October 26, 2009.


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