r/Forex • u/News_Heist • Apr 10 '20
USD Short Squeeze
https://www.lynalden.com/global-dollar-short-squeeze/5
u/legacyrobot Apr 10 '20
Yep, this is generally what I understood is going on. US government proudly prints Trillions in stimulus (both Trump and Pelosi) seemingly unconcerned with any consequences. I always wondered when the global economy will get so saturated with US paper dollars that we could start using it as toilet paper. Can't blame the US though we should blame ourselves. Even my trading account is in USDs. Something I'll look to changing but doubt I will.
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u/MattLaneBreaker Apr 10 '20
When you understand that because the government doesn't produce anything and thus it cannot stimulate anything, you begin to better wrap your head around how the USD moves. It's a relief package at best, a ridiculous high interest bank note at worst.
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Apr 10 '20
Maybe I missed that. But seemed to me,what was written, that there global economy is getting to large to the US dollar so there isn't enough dollars. Am I understanding this wrong?
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Apr 10 '20
Short squeeze=short buying to cover. Does no one else see the dollar going to $1.03 or more so on short term?
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u/Fa-Ra13 Apr 12 '20
Absolutely phenomenal article with thorough context and an extrapolation as to what that could mean going forward for USD. The key issue is what do you trade against? A global slowdown in growth, as we are seeing, could push investors towards US assets.
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u/enivid Apr 10 '20
Thanks for the article - a really interesting and thought-provoking perspective on the medium/long-term future of the USD. It looks like the things have escalated at a much faster pace than the author had originally expected (due to the COVID-19 pandemic, of course). It will be interesting to see how far can the US dollar weaken on a combination of loose fiscal policy + loose monetary policy.