www.CostaRicaTicas.com

I was talking with a friend of mine who is concerned that the US economy is headed for a huge crash, on the order of 1929 magnitude. My knowledge of economics is sketchy at best, does anyone here care to comment on the possibility of this scenario? Seems to me if they're printing more money, it's devaluing your dollar, which may explain why other currencies, ie the CAD or colon gaining in value & as Texas&Vegas pointed out above, the large national debt isn't helping the situation. I've also heard that some of the ways they measure debt & unemployment are artificially skewed to make the numbers look not as bad as they actually are.

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I fart in your general direction. Your mother was a hamster, and your father smelled of elderberries. Now go away, or I shall taunt you a second time!

Exactly. I don't fully understand monetary policy, but I listen to many who do, and they all say the same thing - we are devaluing our own currency with massive debt and continued accumulation of debt - both as consumers and as a nation.

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Man I'm living life like a great white shark swimming with minnows! It's all about panocha, great scotch, fine cigars, loud-ass rock music and speed, speed, speed - plus spending as much time as possible in paradise on earth, Costa Rica!

...And this time (because they've already used up the option), it won't be possible to grow our way or inflate our way out of that crushing pile of present debt service and future principal repayments. If there is even a minor sell-off of US securities or if especially the Chinese make something other than the USD the world reserve currency (they were making noises on this last year), we are cooked.

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"A man accustomed to hear only the echo of his own sentiments, soon bars all the common avenues of delight, and has no part in the general gratification of mankind"--Dr. Johnson
"Amen, brother"-ED

We can always move to Costa Rica and become banana farmers.

One more reason I am moving to CR and converting my IRA into Euros as soon as I can.

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Man I'm living life like a great white shark swimming with minnows! It's all about panocha, great scotch, fine cigars, loud-ass rock music and speed, speed, speed - plus spending as much time as possible in paradise on earth, Costa Rica!

Thank you for telling the board you are moving to Costa Rica soon, I do not think you have mentioned that in any of your recent post

Please elaborate on how going over to Euros will effect USD/Colone rate?
Are there ATMs in San Jose that give out Euros? No exchange rate? do they take them at sodas?

No worries. I have already spoken to my broker, and when I make withdrawals I can always make them in dollars, even though the investments are in Euros. And there exchange rates are very good, I checked them out. Or I can get a debit card when that is attached to my investments and use it in CR to get Colones at ATMs. I just don't want my investments sitting in dollars as the dollar continues to spiral in to the toilet.

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Man I'm living life like a great white shark swimming with minnows! It's all about panocha, great scotch, fine cigars, loud-ass rock music and speed, speed, speed - plus spending as much time as possible in paradise on earth, Costa Rica!

Nobody knows for sure what will happen. We could eventually have a crash or, hopefully, we can "muddle through". There are many unknown future factors: disasters, government actions, wars, new industries, wealth distribution, taxes, oversea job transfer, etc.
My belief is that we are heading downhill and unless there are changes made, we are likely to have a major crash-when, nobody has a crystal ball. Wealth of a country is usually produced by its resources or manufacturing. We are sending massive amounts of money overseas for drugs, oil, military actions, and our jobs and manufacturing is disappearing to places like China. The prognosis is that the US standard of living will certainly drop in the future.
We operate under disfunctional economic ideas like the market is always right; therefore, banks can take on very high risk and have the government bail them out. Or supply side economics: If we give enough tax cuts to the wealthy, they will invest the money in productive areas instead of their pockets.
At this time, I am not seeing any movement or government policies that will stop the economic slide. We could do more research for new products for the future. We could give more tax cuts for small companies that creat jobs and take tax subsidies away from large companies sending jobs overseas. We could legalize drugs, tax them, and spend less money for law enforcement and jails. There are probably many other things or ideas that we could do, but what I am seeing is a grid locked two party government with yesterday's ideas that don't work anymore.
Since we could be blindsided by another hugh economic crash, like Japan was by the size of the Tsunami, I have invested in some gold outside of our country as a disaster insurance policy.

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Pura Vida

That we are declining is the opinion of many astute observers. Our job in the global economy was to manage the money, and obviously we didn't do that very well. The rest of the world has stopped looking in on us for leadership, as we on the one hand want to believe we are the greatest nation and on the other, don't seem to want the responsibilities leading the world requires. So it's either: lead, follow, or get out of the way.

Oh why did I click on this thread? We have been raided and raped like a cheap wh*re by the offshore interests. They have came and gotten our education, taken our technology, our jobs our resources and are now tossing us out like the weekly garbage. We (use your own judgement as to who "we" is) have allowed it to happen. The day the USD is replaced as the world reserve currency is the day we will all pray for rapture. I have read this thread and jokes have been made of the situation but it's really not very funny. I could write on this subject for hours but let this post suffice.

dapanz1

No other options for a reserve currency, Euro is out of the question now that Greece and portugal and who knows else are defaulting and everyone bickers who should cover them, Chinese will never be a reserve currency just cause the nature of their government and Im not sure they even have the inlcnation to want to be reserve, Russia Nope now way 1998? so that just leaves the swiss franc which is not possible to be a reserve because the float is too small and they already hate how strong the franc is cause it kills their tourism industry. So our currency will be the reserve for quite some time, we may seem risky but we are the least risky of the others so by default we will remain the reserve currency for a long time

Hunter, I do agree with you. The USD is the deepest, most liquid, most logical choice for the reserve currency. If the Chinese ever have ambition to do it, that could present a problem. Rumor has it that China is raising interest rates this weekend so more money will flow their way, undoubtedly. The real problem is that so much cheap, worthless money (USD) is floating around the world. But, I stick to my guns, if the USD is ever replaced will be living in sub Sahara conditions economically with all the debt we have. I will stick to my guns on that statement. I have a daughter who is 11. What will it be like for her?

dapanz1

Hope is NOT a strategy.

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"Actual happiness always looks pretty squalid in comparison with the over-compensations for misery. And, of course, stability isn't nearly so spectacular as instability. And being contented has none of the glamour of a good fight against misfortune, none of the picturesqueness of a struggle with temptation, or a fatal overthrow by passion or doubt. Happiness is never grand."
- Aldous Huxley, Brave New World, Ch. 16

The more I read Greengo's rants about about Costa Rica the more I understand Muffdiver when he posted this:

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Pura Vida
Only Irish coffee provides in a single glass all four
essential food groups:
alcohol, caffeine, sugar and fat.
Alex Levine

There is something weird about the Colone holding strong against the dollar Given the fact that they have such high inflation it should be weaker than it is, it is definitely being manipulated somewhat or maybe greengo is right maybe there is a supply/demand imbalance due to laundered dollars being exchanged to Colones that couldnt be exchanged in Colombia. The COlone is such a small float it would be easy to manipulate