How does a currency collapse? And the U.S. $? - Julian D. W. Phillips
Whilst most observers and particularly U.S. observers like to have tangible facts and numbers with which to mathematically gauge the present and the different possible futures, a collapsing currency situation is not as neatly gaugeable. Indeed it is driven in stages of 'confidence', which are rarely measurable in advance.
For instance we see today the move of the Pension and other long-term funds into the gold E.T.F.' one finds there are no mathematically measurable factors with which to measure the pace of change to these funds. Yes, the number of 'Road-shows' the World Gold Council does affects this move to some extent, but how do you measure the spread of that knowledge and resulting investment in the E.T.F.'s outside of that? How does one measure the forces causing uncertainty and falling 'confidence'.
It is an emotional progression, one that moves in lurches as particular incidents destroy confidence limb by limb. In such a climate a steady degeneration of confidence lead to an effect we shall call a "plateau - cliff" process.
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