The election of Barack Obama does not change America’s fundamental economic flaws, says Bill Bonner. The slump caused by too much debt will continue. And a US dollar crash caused by reckless money printing is still just around the corner.

This from The Daily Reckoning:

America’s voters spoke yesterday [Tuesday]. And they said “Give us Obama.” And it came to pass that the man called Obama was given unto them.

“America is a place where all things are possible,” said the man himself in his victory speech.

And yes, it is possible for a half-black man to be elected. But no, all things are not possible. It is not still not possible to get rich by spending money. Nor is it possible to save a man from too much debt by giving him more credit. And you still can’t trust a politician… or his money.

The election “changed everything,” shouts the headline on today’s International Herald Tribune. But the eternal verities still apply; Barack Obama is not going to change them.

And that means that a slump caused by too much debt cannot be made to disappear. You can disguise it. You can delay it. You can push the losses onto someone else. But you can’t escape it.

The Dow rose 305 points on election day. Investors are looking for any bit of flotsam or jetsam to they can find to buoy them up. Anticipating an Obama victory, they thought things might change. The price of gold shot up $39. Gold buyers have their suspicions too.

“Post election rallies” are more myth than reality. Stocks rose strongly following Reagan’s first election to the White House…and again when Bill Clinton was elected. But neither Bush, père nor fils, boosted stock prices.

Still, an Obama rally is probably on its way. Investors are ready for it. Practically every major investment guru is calling for it. “Stocks are cheap,” they say. “This may be the greatest investment opportunity of our lifetimes,” they add. Even the ‘contrarians’ are getting aboard. “Investors are frightened,” they point out. “Confidence is down,” they explain. “There’s blood in the street,” they clinch the argument. All over the world, people look to Washington with hope in their hearts…and humbug in their heads.

“A New World Dawns” proclaims Britain’s Daily Mirror.

People look at Obama and think they see a young Kennedy… they think they’ll be about to rerun the tape and do a little editing - a New Frontier without the Vietnam war… a Camelot without Lee Harvey Oswald.

But it’s not a New Frontier that America faces… it’s an old, worn out flimflam. It’s not a new dawn at all – a dark night is falling.

Our old friend Adrian Day, originally from London, England, now from Annapolis, Maryland, explains:

“The position of the US today is approaching that of Britain at the end of World War II. Britain had been the world’s dominant economic, political and military power, with the world’s reserve currency. But by 1946 it was militarily stretched beyond its capacity, and highly indebted. The US took over the #1 spot and the dollar became the world’s reserve currency, with the pound falling from five-to-one in 1946 down to parity four decades later.

“The problem with being the world’s reserve currency is that more money is created than is necessary for the domestic economy’s needs. For decades, the US has created far more dollars than it needs, but it didn’t matter so long as other countries were prepared to buy and hold those dollars. But those dollars still exist. As other countries lose confidence and diversity, those dollars eventually come back…”

Yes, dear reader…a man must always compensate for his strengths. The US had the world’s strongest and most reliable currency for half a century. It was our greatest strength and our biggest export. But this much IS changing: the dollar is no longer our biggest strength; it is becoming our biggest weakness.

Source: This Is Not A New Dawn