the dollar is going nowhere but down

We are small time investors (if that), we cannot see or do much manipulation or speculation – only institutional investors can do that. What we can see is that, at macroeconomic level, the dollar is going nowhere but down.

The rest is just noise.

What we must remember it that It is not fundamental (industrial needs) but monetary demand that drives silver and gold prices. Keep that point in mind and never forget it. It is monetary (or investment) demand that ultimately drives both silver and gold, not fundamental.

At the macroeconomic level, there are 3 main factors affecting the value of our currency

1. Inflation
You can read what inflation is here in detail. In a short sentence, inflation is that too much paper currency has been printed/created causing the value of the currency to decrease and lose its purchasing power. The monetary demand, a desire to hold real money, is created when the fiat currency (paper) inflates to a point when it starts to affect our day to day life. For example, a loaf of bread jumps from $1 to $2 or $3. Once regular consumers feel this, it will trigger a much greater fled from paper to gold, creating a tremendous push for the gold price.

a.

a. National debt
b. government deficit
c. trade deficit
d. war

All of the above 4 factors force the government to create more paper currency. They are essentially money-drains.

2. Key interest rate
Lower interest rate will cause that less people would like to hold their savings in this currency, especially those creditors around world. On the other hand, the economy and the sumprime mess are forcing the Fed to keep lowering the interest rate. What are the choices do they have? Lowering the interest rate seems to be the only logical solution to save both economy and foreclosures, of course at the expense of the dollar, meaning at the expense of our life saving.

3. The economy

Do I need to say more?

It is monetary (or investment) demand that ultimately drives both silver and gold, not fundamental.