roger maxims

Will the EUR/USD Hit 1.60 This Week?

BoJ just confirmed it has not intervened for 4 years since 1 April 2004.

And if you're skeptical, they are actually quite honest about these things, since it helps achieve their purpose of manevouring free markets.

Will the EUR/USD Hit 1.60 This Week?

The real questions for EUR/USD, Kathy, is this:

Q. Is Europe in deeper trouble than US amid the credit crunch?

A. Well US banks will write down about 5 - 10 times what Eurobanks will, but let's say we are just as bad because of globalisation.

Q. If we are equally handicapped, whose currency will be more expensive?

A. Um....let me see.... USA - approaching 0%; Europe - keeping 3%+ with equal inflation at both places.

Q. Hey but Eurozone unemployment is so damn high?

A. Well... the French will strike anyways... the Germans will be just as inflexible... the Italians laid back... and more countries like Romania waiting to share wine mountains. Fact is, status quo remained since 1999 when ECU became EUR.

Q. So will we see 1.60 this week?

A. What's the point of this? Same as asking if we will breach 95 yen or 0.95 CHF.

Kathy, we are in a downward spiral. Governments have no interest in intervening currencies because this time it is jobs that are disappearing.