Mr. G

U.S. Unemployment: From Bad to Worse

I think one way to assist the unemployment rate is to create a better tax policy. Encouraging business in the US would greatly assist industry to stop going overseas. We need to extend our manufacturing base.

We need to expand our mining industry so we are not so dependant on imports. Attacking the problem from as many angles as possible will assist in the long run. Our country is so service oriented it may lead to our downfall if we depend on the rest of the world for all of our necessaries. A better balance locally could prevent severe imbalance in our employment rate. Guess I am just another useless voice in the wind, but the US should have future orientation in order to insure our future in the global economy. GI

Is the Dollar Toast?

To the OLD Trader: NO , I am not kidding. Read the rest of my post. Dont jump conclusions. The evidence of what the FED is trying to accomplish takes time. Raising the lending rate just to correct the dollar would be detrimental to our economic expansion.

One of the primary reasons for dollar depreciation is the world holds about 7 trillion or more in reserves,and as they sell dollars to diverify their reserve base, it puts downwrd pressure on dollar value. This is causing large moves in the euro(150 pips per day average.) The cause and affect of dollar movement is not solely related to the FED rate. GI

Is the Dollar Toast?

Maintaining a 0.25% FED rate supports the economic policy of a strong dollar because it encourages bank lending to assist and foster economic growth.

Another benefit is US exports. It makes our products competitive on the global markets. The pegged yuan makes Chinas products equally competitive.

On a final note, currency traders set the prices of currency value, not the US govt. If the current pattern of FED policy works, the dollar will appreciate as our economy grows, but the hurdles of employment rate and credit markets have to resolve first. GI

Is the Local Top in Precious Metals Stocks Already Behind Us?

There was a time in history when the DOW was at 800 and gold rose to $800 the ounce. If this correlation is any predictor, gold could rise above $2000 the ounce. GI

Unemployment: It's Even Worse than You Think

Gee, I commented yesterday about economic policy and the overseas migration of the mfg companies and everyone jumped down my throat. Nice to see rational discussion on the subject.

Is the Hated U.S. Dollar About to Rally?

Regarding the comments about raising the FED rate ,I recall lowering as being a stimulus to the US economy because it encourages easier lending to stimulate business. In the current environment, raising the rate would be detrimental until banks lend again, which they are not.

Raising the rate is frequently a response to slow the economy down to prevent inflation. As anyone can see, traditional thinkinking suffers when the markets are out of wack. GI

Is the Hated U.S. Dollar About to Rally?

Everyone talks about the dollar as if there is some overseer at a master contol switch that makes the decision while forgetting that the dollar index is traded against a basket of currencies, and its fair market value is determined by traders who determine the dollars value by market psycology, that is, the majority of traders controlling the direction of price.

The recent trend reversal was probably a massive liquidation by short sellers covering their bets because of all the chatter about dollar reversal. As the US economic indicators reveal confusing news, I would expect the dollar to consolidate which appears to be the case now. Traders are looking for positive news from the economic indicators before they are willing to bid the dollar higher.

Gold Stocks Slide as USD Index Strengthens – Should You Be Concerned?

I have traded the forex for some time and watched the gold bugs predict $2000 gold over 2 years ago only to see it go much lower. When gold drops, it tanks. Notwithstanding the current account deficit we can see, the US economy has unbelievable resilience. Just ask Gates and Buffet when they lost a billion or so from a previous current account read..I admit the situation is not bright, but caution is always advisable when playing real money. Keep your eye on the unemployment rate next friday. It is a heavy hitter and if it drops, you might be surprised. If it goes higher, I would say the long in gold is still on the table.

Gold Stocks Slide as USD Index Strengthens – Should You Be Concerned?

It is fairly obvious that gold and oil are trading inverse to the dollar index. Looking at the dollar index, It is still in its downward trend technically, but if it goes higher this week, gold and oil could break more to the downside, and the dollar could be bottoming which would be be a bigger reason to wait on the sideline till a more positive direction for the dollar is determined. The key is to watch the US fundamental readouts this week. The chopiness in the market may be resolved if the US economy committs to one side or the other.

American Austerity Is About to Begin

What I perceive from all the chatter about govt bailouts and the trend towards socialism is perhaps the worst pessimism about America I have ever seen in my lifetime. The poor lady is being battered about by the pundits, the conservative right and by the "experts" reading doom and gloom in their crystal balls.

The alternative to present govt economic policies would have been exactly what everyone is saying will happen.

It is my belief we have all learned a lesson about free unregulated capitalism. The lesson is that overleveraging freedom to our Wall Street and banking industry exposed an insidious weakness in our capitalistic system. Intense greed results in destruction of the system, lending deficiencies and ultimately meltdown of our credit based system. The comments I hear everyday reminds me of the middle ages and feudalism. I believe the conservatives still feel they are the "barons" of ancient times and the middle class are the worker bees who must depend upon the rich for lending handouts in order to survive. So much for supply side economics.

70% of our GDP is consumer based and til the demand side of the equation returns to equilibrium I am afraid the barons are may not flourish as in times gone by. GI

Fed Funds Futures Predicting Strong Chance of September Rate Hike

Considering the current account deficit, raising rates and printing more money to pay debts by the FED spells trouble longer term for the US.

Bernanke Brushes Aside Inflation, Focuses on Growth

Inflation is caused by too many dollars chasing too few goods. As long as supply of anything remains sufficient, and money supply remains constant, inflation shouldnt be a problem. The weakness in the US is printing more money to bailout debt ridden banks which increases money supply.

Did Gold Bugs Miss the Fat Lady?

The most salient point is that gold appears tied to economic parameters perceived in the long term,not short term teasers. As inflation, stagflation, and recession lingo creeps into our mixed views, particularly in th EU and the US, gold appears to be a steady factor to hedge against currency fluctuations and golds ultimate moves may not be tied to just one factor.