Are the Currency Markets Warning that there is Trouble Ahead? The Precipitous Decline of the US Dollar and its Impact on the World

Are the Currency Markets Warning that there is Trouble Ahead?
The Precipitous Decline of the US Dollar and its Impact on the World

London, UK - 12 July 2007, 08:41 GMT

Dear ATCA Colleagues

[Please note that the views presented by individual contributors are not necessarily representative of the views of ATCA, which is neutral. ATCA conducts collective Socratic dialogue on global opportunities and threats.]

News that Standard & Poor's may cut the ratings of 612 residential mortgage-backed securities backed by US sub-prime loans (worth an estimated USD 12 billion) began the US dollar's further decline against both sterling and euro 36 hours ago. Fears that other ratings agencies could follow suit made the British pound (GBP) hit a new 26-year high against the dollar, rising to USD 2.0322 -- its highest level since June 1981. The euro (EUR) climbed further into record territory yesterday -- within sight of the USD 1.38 mark -- amid concerns about the health of the US economy fuelled by discouraging growth forecasts from key retailers and home builders as well as the currency markets focus on the possible collapse of the US subprime lending market. Traders said they sold dollars on concerns that problems in the US housing market could slow American economic growth.

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We look forward to your further thoughts, observations and views. Thank you.

Best wishes

For and on behalf of DK Matai, Chairman, Asymmetric Threats Contingency Alliance (ATCA)

ATCA: The Asymmetric Threats Contingency Alliance is a philanthropic expert initiative founded in 2001 to resolve complex global challenges through collective Socratic dialogue and joint executive action to build a wisdom based global economy. Adhering to the doctrine of non-violence, ATCA addresses asymmetric threats and social opportunities arising from climate chaos and the environment; radical poverty and microfinance; geo-politics and energy; organised crime & extremism; advanced technologies -- bio, info, nano, robo & AI; demographic skews and resource shortages; pandemics; financial systems and systemic risk; as well as transhumanism and ethics. Present membership of ATCA is by invitation only and has over 5,000 distinguished members from over 120 countries: including 1,000 Parliamentarians; 1,500 Chairmen and CEOs of corporations; 1,000 Heads of NGOs; 750 Directors at Academic Centres of Excellence; 500 Inventors and Original thinkers; as well as 250 Editors-in-Chief of major media.

The views presented by individual contributors are not necessarily representative of the views of ATCA, which is neutral. Please do not forward or use the material circulated without permission and full attribution.

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