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John Lounsbury, Managing Editor and Co-founder of Global Economic Intersection, provides comprehensive financial planning and investment advisory services to a small number of families on a fee only basis. He has a background which includes 34 years with a major international corporation, 25... More
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  • Dollar Dive 5 comments
    Sep 23, 2009 7:50 PM

    This chart from The 5-Min. Forecast (here) shows the dollar's 14% nosedive since March.  If the stock market has a pullback here, the slide of the dollar could stop and in might strengthen as long as stocks decline.  Sounds strange, but, for almost a year, the dollar and stocks have been negatively correlated.

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  • Mono
    , contributor
    Comments (156) | Send Message
    they are doing whatever they can for nominal bliss...unfortunately that is the death of us. real returns are all that matter and dollar strength is the only thing that will keep the US above water.
    23 Sep 2009, 08:24 PM Reply Like
  • yellowhoard
    , contributor
    Comments (1500) | Send Message
    To reach dollar strength, we'd have to see a speech from the president where he would be outlining austerity measures in government pensions and a cancellation of all of his spending programs.


    23 Sep 2009, 09:08 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7603) | Send Message
    A strengthening US$ is not something I expect to see for some time. As YH has pointed out, it would require a complete about face in fiscal policy. At some point I can't help but expect that Treasuries will follow the direction of the dollar. After all, as the dollar weakens relative to currencies of its trading partners, who in their right mind will want to buy US Treasuries (except our own Fed)? Flight to quality? Where's the quality?
    23 Sep 2009, 10:15 PM Reply Like
  • doubleguns
    , contributor
    Comments (9716) | Send Message
    John, I believe you when you say if the stock market dives the dollar might get a boost, but it wont last long.America is being sold down the river by our own govt.


    We are up the proverbial river this time with out a paddle AND a canoe. Life jacket aint looking to good either.
    23 Sep 2009, 10:40 PM Reply Like
  • Value Added
    , contributor
    Comments (465) | Send Message
    I would expect the dollar to be inversely correlated, with a lag, to M3. And, M3 will continue to expand as long as the banking industry and FDIC are in trouble. So expect the downward trend of the dollar to continue.
    24 Sep 2009, 07:09 AM Reply Like
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