King Dollar Roars Back

The U.S. Dollar index for major currencies reached its highest level this year, and is at the highest level since December 21, 2007 (see chart above). Oil fell today by almost $5 per barrel in the spot market to $112.43 (brent spot) and $115.20 [WTI] and below $115 in the futures market. Stock market rose by +300 points.

Comments

[secmaven:]

No international financial crises during the Olympics. The Chinese are at work.

2008 Aug 09 10:28 AM

[CLH:]

Beautiful! Dollar up and inflation down. Also Americans will become savers again as people become frightened. Capitalism works--no need for the left.

2008 Aug 09 11:30 AM

[User 201843:]

End of August....hold on it will be a very rough ride for some. Stocks, dollar etc. Gold is the only option for irresponsibility!

2008 Aug 09 12:45 PM

[NOWHEREMAN:]

Try a Fib retracement for dollars slide this year.

But everything hinges on Russian invasion of Afg, ooops, Georgia. Dollar always rises when situation such as above occurs.

2008 Aug 09 01:30 PM

[jdl51:]

With 10 trillion in debt and rising at the rate of $700 billion a year (don't forget those little off budget items, like Iraq) the world will be awash in U.S. debt for the foreseeable future. I expect interest rates to rise to entice the world to swallow this tsunami of debt which will force our floundering economy to grind to a halt. Then we'll see how the dollar does. Might happen even sooner if any of our friends decides to get out from under their treasury holdings, like China, Russia and Japan.

2008 Aug 09 02:57 PM

[LilBob:]

The resurgence of the dollar is inherently linked to the recent surge in oil and food prices. The rest of the world still loves to get its hands on US dollars. For all the relative instability of the dollar recently, US currency is still far more reliable than most national currencies. When gasoline consumption declines and elective retail purchases hit a wall the rest of the world will attribute a higher value to US dollars as they become relatively scarce in the market-place.

2008 Aug 09 05:46 PM

[Philly Jim:]

JDL - U.S. bonds are already being dropped because of their low rates, money is moving into currencies, etc. When Obama gets in office, I'd expect to see an infrastructure building boom with a lot of that sidelined money moving into muni-bonds, public/private infrastructure projects. I agree with RLoftus, the U.S. dollar is the safest bet, the U.S. is the safest bet. I was caught-up in the Internet, real estate now BRIC phenomena like many others I know; just know when to pull your money out! The BRIC fad is almost completely DONE! I've see it all on the other side of the world, was impressed with the growth rates and building boom going on in every city in the East and 3 years later (2008), I still feel like I can breathe easier and sleep better being in America. As much as I hate to see the emergence of this new criminal/hip-hop culture taking over almost every U.S. city & public institution, I still feel safer and more human than any other country I've been to. You just can't buy or build that kind of freedom, we have something unique here! I say Euro will be at 1.13 by end of 2009 and 1.30 cable. Silver and Germany can't keep them immune from the global economic hiccup. The U.S. hasn't had it's infrastructure boom yet and when it happens, it's gonna be with repatriated smart money tired of the speculative "third world" plays. Enjoy the Olympics. ;)

2008 Aug 10 12:15 AM

[Lou Thomas:]

This article just presents data that we already know about the dollar's recent gains and then pastes a big, smiley face of a headline on as the title.

Since, from an anthropological standpoint, I find this behavior fascinating, I decided to look at this author's other recent articles. Here is a sample:

# King Dollar Roars Back

# Adjusted for Growth in the US Labor Force, July's Jobless Claims Are Below Average

# Economic Stimulus Package Boosts Real Disposable Income

# U.S. Oil Production Today Same as in 1948

# Second Quarter Homeownership Rate Has Largest Increase in Four Years

# There's Been Major Deflation for Some Products

And, possibly my favorite:

# Putting $1T Subprime Mortgage Losses in Perspective


This guy must sit in front of his computer all day with headphones on and Bobby McFerrin's famous mantra on infinite repeat.

2008 Aug 10 12:24 AM

[Saffie:]

One statement only:

Infinite dollars versus finite gold = ?

2008 Aug 10 08:08 PM

[GaryD:]

This guy picks and chooses his data to say whatever he wants it to say. This is called the "completion backwards principle" and it has been used by pseudo-scientists, fraud artists, alchymists, and hack academics throughout the ages. Here is a dollar chart over a longer time frame:

bp3.blogger.com/_H2DeP...

Like most academics, he probably wants a job at the fed, so he is showing that he is a good little soldier with his posts. He waves his hand over data noise and makes hints about the future. In previous ages he would be reading chicken entrails, or tea leaves, or palms, or conjuring spirits to reveal the future, or...you get the point.

2008 Aug 11 03:00 AM

[juicyjoo:]

Hey Mark (Deluded Perma-Bull). Did you lose your common sense while you got your Ph.D.?

2008 Aug 11 07:58 PM