Jim Sinclair’s Commentary

This is a downward spiral that cannot, like with people, be stopped without intervention. The point of intervention was when ex-Chairman Volcker said the dollar would continue to decline until policies were put in place that have a proven history of turning deficit towards surplus . None of that has occurred as we stay the course. The Formula is active here as well.

What Greenspan is talking about is the negative Treasury International Capital Flows (TIC) report which is the stuff .7200 USDX and lower is made of.
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Greenspan Says Demand for U.S. Debt May Be at `Limit'
By Kevin Carmichael and Simon Kennedy

Oct. 21 (Bloomberg) -- Former Federal Reserve Chairman Alan Greenspan said the dollar's depreciation may reflect growing unwillingness among foreigners to buy U.S. debt.

``Obviously there is a limit to the extent that obligations to foreigners can reach,'' Greenspan said in a speech in Washington today. The dollar's decline to its lowest since 1997 may be ``an indication America is approaching this limit.''

Greenspan's warning came after the U.S. Treasury reported last week that international investors sold a record amount of U.S. financial assets in August. Total holdings of equities, notes and bonds fell a net $69.3 billion after an increase of $19.2 billion in July.

The dollar has declined about 8 percent against the euro this year and 4 percent against the yen.

The former Fed chief, who published a 531-page memoir last month, spoke for about 35 minutes before taking questions for another half hour on the sidelines of the meetings this weekend of the International Monetary Fund and World Bank. The lecture was hosted by the Per Jacobsson Foundation.