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News Link • Dollar Meltdown The

Exploring the "Dollar Crash" Thesis in Pictures

• themaven.net by Mike Mish Shedlock

People have been predicting a crash in the US dollar for something like forever. Let's investigate another crash thesis.

ZeroHedge reports the "World's Most Bearish Hedge Fund" has a "Stunning" Theory What Happens Next to the Dollar.

Bear in mind the views that follow are not that of ZeroHedge but rather that of Horseman Global CIO Russell Clark who went 100% short in 2016 with negative results.

Clark did make money in 2017, an impressive result given the performance of the major indexes.

Clark's Theory

It is very easy to get bearish on bonds. With Chinese growth improving, and commodity prices rising, inflationary pressure is building. Furthermore, Chinese bonds currently offer 4%, substantially higher than developed market bonds. In addition, in a break with the Japanese experience of QE, the Federal Reserve has managed 5 interest rate increases, rather than only the one or two that Japan has been able to achieve since the bursting of the bubble. The refrain that I have heard these days is that QE works, and the US will be able to easily exit QE policies, followed by the ECB and the BOJ, and that bonds are a sell.

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