A Dollar Melt Up?

Summary

Discussion of the effects of a potential dollar melt up or maelstrom on capital and asset markets.

Examination of Bitcoin as a potential conduit for Chinese capital outflows.

Discussion of metrics for Asian "dollar" and Euro "dollar" liquidity.

Examination of DXY dollar and recent divergences with equities and bond yields.

I wish to dedicate this missive, to one of my mentor's Salmo Trutta, who is a prolific commenter on SA. Without Salmo's tutelage, and insistence in not masticating and spoon feeding the baby ducks, as in learning the hard way, by doing the leg work and earning it, this missive would not have been possible. To you "Proximo"... "win the crowd and win your freedom" - Spaniard

In addition to the summary bullets above, we include this advisory on what insight potential investors might gain from the ensuing discussion. What follows is a discussion of a complicated macroeconomic issue. Those of you who already follow me know that most of my missives attempt to connect the dots on seemingly disparate and unrelated market occurrences.

As those faithful readers know all too well, and we thank you for your patronage and patience, which only hell knows wherefore and why, this is not a brief prospectus nor for the casual reader or faint of heart. Those desiring a dearth of detail as found in elevator or sound-byte versions, should immediately cease reading this missive, for continuance may severely damage their A.D.D (attention disorder deficit) modus operandi.

As always, with regard to the subject matter and life in general, we claim to be nothing more than an idiot, albeit a useful one. In attempting to decompose these events, it is our hope that we can share what little we know (next to nothing), while perhaps learning something new and useful along the path. As always, take the best and leave the rest.

In brief, this is the first chapter, in a series of thematically related missives which will attempt to identify the macroeconomic forces with potential to pancake capital, commodity, equity, bond and asset markets six ways to Sunday in what would amount to, a uncontrollable dollar melt up or maelstrom. We start today's journey using this analogy...

From the 1984 scifi/fantasy film classic Ghostbusters... A bolt of lightning crackles from the swirling dark cloud and strikes the rooftop of 55 Central Park West, where the Ghostbusters stand facing their new God like Moses on Mount Sinai. And then Gozer speaks to them in a voice that can be heard throughout Metropolitan New York and parts of New Jersey.

"SUBCREATURES! GOZER THE GOZERIAN, GOZER THE DESTRUCTOR, VOLGUUS ZILDROHAR, THE TRAVELLER HAS COME. CHOOSE AND PERISH."

VENKMAN: (shouting to be heard) Is he talking to us?

WINSTON: What's he talking about? Choose what?

STANTZ:(to the heavens) What do you mean "choose?" We don't understand.

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