Coelacanth

Historic Strength for the Dollar

Excellent work Bespoke.....hope you guys did well this morning getting long dollars vs. EUR, Cable & AUD.

Sell the U.S. Dollar into Strength

Philman & Dave,

I don't day trade....when I enter the market it's typically anywhere from a couple of weeks to a couple of months so I can take advantage of geo-political & macro-economic trends.

Can't believe I'm getting caught up in this conversation but, no guys, it's not lost on me that our beloved stars & stripes has systemic financial structural problems that, if not dealth with, will weigh on our currency long-term. That said I'm not an "extreme doom & gloomer" and believe Warren Buffet when he says "Don't bet against America long-term".

Like Fabian Hug says....."mess for mess, I prefer America's"

Be well gentleman.

Sell the U.S. Dollar into Strength

Paul & Pete,

I could easily refute most if not all of what Mr. James Conrad "Phd" (that still cracks me up....I love typing that. LOL) says.

If you look at some of my past comments, you'll see I've expanded on my opinions on several occasions and have been spot on in many cases. That I haven't done that here only means I've been too busy trading. It's revealing that didn't occur to either of you

It's very instructive for someone like me to read what the erstwhile James Conrad Phd has to say week after week.....and then see the markets do the exact opposite of what he says they'll do....week after week.

I'm actually quite grateful.....he's currently one of my best contrarian indicators. I truly hope he continues posting for a while.

Sell the U.S. Dollar into Strength

I love it when I find posters (one's who have Phd at the end of their names are an extra bonus) that I can use as contrarain indicators when I trade. LOL.

By doing the exact opposite of what you're saying I've profited by buying dollars on dips and selling almost everything else. Do we have systemic structural financial problems that if not fixed will weigh on the dollar long term if not fixed? Sure.

With Gold bugs currently puking their guts out seeing their beloved ore hovering around $750.00 an oz. after seeing it above $1000.00 an oz. only 7 months ago, it's not surprising Mr. Conrad "Phd" (who has an "exclusive" newletter one is only privvy to if their recommened to him....LOL) would be feeling some frustration.

That you would minimize the problems in the U.K. & Europe makes it painfully clear you don't trade currencies and are simply making a sojourn in to a subject matter you know less about than you think.

The Great Dollar Pump of 2008: A Doomed Central Bank Intervention

9/7 Strategy:

EUR/USD: Buy dollars in to weakness.

GBP/USD: Sell Cable in to strength.

Mission Accomplished.

Will August Non-Farm Payrolls Top 100K?

Strategy: If NFP come in worse then consensus buy dollars in to weakness and sell Cable in to strengh.

U.S. Dollar Golden Cross

Too funny....it's always painfully obvious me when people who don't trade in currencies comment on these threads.

Good work Bespoke Investments! Your technical indicator is a positive sign. After seeing many candlestick "hammers" & "shooting stars" on USD daily charts last night it wouldn't surprise me to see an interim dollar correction coming. After this week I'll probably step aside a few days as nothing would make me happier than getting long dollars in to temporary weakness.

Market Predictions: 'Crazy' About the Dollar

Hey Paul,

You bring up some great points.

I could be mistaken but I thought the increase in minimum wage was going to get phased in over time. Plausibly this could mitigate wage pressures in the near term keeping us out of a wage-price spiral situation.

I agree with you about the auction rate securities mess. Pretty daunting. I think most companies are working hard to re-imburse investors though and it appears the Fed is going to keep lending to commercial banks for some time to come.

My sense about the negative effect a strengthening USD would have on American exports is would have to appreciate much, much further for that effect to be truly palpable. The flip side is a stronger dollar will help to tamp down domestic inflation and gives Americans more purchasing power. We'll see.

Market Predictions: 'Crazy' About the Dollar

MarkMedayski,

So the truth is revealed.....you're a Jew hater and your opinions read like some hack partisan blogger.

Market Predictions: 'Crazy' About the Dollar

MarkMedayski,

Interesting take. So you basically want euro to go 1.70 thereby choking off and killing euro-zone exports even more so than is happening now? Great idea.

Interest rates to 10%? Too funny. While the ECB will be lowering rates in 09' - 10'.....ours will be rasing them.....making America's assets more attractive than the euro-zones.

Euro-zone unions aren't doing you any favors either. Because you're so unionized compared to us "stupid Americans" many euro-zone employees have already won outsized wage increases. Betcha can't guess how euro-zone companies are going to compensate for higher unit labor costs. Can you say wage-price spiral?

EU Industrial production, manufacturing, consumer sentiment, consumer spending, business confidence....all falling off in dramatic fashion.

The EU is about to find out if the twelve gold stars on their flag are in deed representative of unity and perfection.

Market Predictions: 'Crazy' About the Dollar

Excellent piece Louis....and yes I agree the euro has much longer slide to go. Siesmic shifts don't occur like this all the time and investors would do well to take advantage of what's happening now.

It was interesting this week to see euro-zone, French, Italian & German GDP growth for the 2nd qtr. were all negative. Despite Trichet's hawkish stance I suspect euro-zone slowing will become more and more pronounced in the coming weeks and months The cacophony of calls to lower rates will only get louder and louder.

The BOE's quarterly inflation report this week was striking in how dovish it seemingly was....almost hinting rate cuts may come even before CPI, PPI and import/export input indicators show signs of slowing. The idea being that as long as it was evident that inflation had peaked or was cresting....rate cuts would happen sooner rather than later.

My suspicion is the same may happen in euro-land and that markets haven't priced in this possibility.

You Can Get on the Gold Train and Ride the Dollar

Chux08,

Did you fall hook line and sinker for Jim Rodger's advice to "dump the dollar and get long gold"? You do know he's been long gold for 10 years now right? How's his advice working out for you lately?

It's pretty clear you're not a trader. Did you really believe an over-valued euro was sustainable? How intense do you think images of people in emerging countries rioting over food prices had to be before there was the will to ease the pressure? Do you really believe there would be any airlines left in a year from now at $146.00 barrel oil?

What you're seeing is the pent-up capitulation of unsustainable global macro-economic imbalances. That's o.k. though.....I'm sure you've been "buying gold on dips" because you know all this nonsense about a stronger dollar will blow over eventually. Better to be right than to make money though right?

A Closer Look at the Dollar Rally

As a matter of fact the euro-zone trade deficit has been ballooning in the most recent reads due to increased imports and lower exports (a strong euro has been killing exports)

All democracies see an erosion in their manufacturing base as they mature but this isn't the main catalyst to a currency's rise or fall.

Yes...Spain, Ireland & England are all seeing an huge unwinding in their housing markets. 15% of Spain's GDP is it's housing sector. Ouch!

You're minimizing the euro-zone's weakness.....industria... production, manufacturing, consumer spending/sentiment & retail sales have all fallen off a cliff and point to pronounced future economic weakness. Many economists are now saying euro-zone growth probably contracted in the 2nd qtr. In addition, euro-zone businesses are increasingly defaulting on their commercial loans.

A massive slowing in consumer spending suggests the euro-zone isn't currently consuming "half of it's own production". Additionally exports to emerging markets are slowing and England, where roughly 15% of euro-zone exports have gone in the past, is pulling in the purse strings.

Well....you don't have to guess or invent conspiracy theories for why the $ has had such a spectacular run of late.....most folks in trading circles know why. After the ECB's rate decision last week (and in particular Trichet's accompanying statment and news conference) investors began paring back bets the ECB would hike rates again.....to boot, based on medium term fundamentals, the euro is ridiculously over-valued against the dollar.

It's not so much dollar strength you're seeing as much as the euro losing value relative to other currencies....understa... the difference? Yes, it is based on fundamentals....namely the deteriorating fundamentals out of the euro-zone. Most if not all the bad news has already been priced in to the dollar.....can't say the same for the euro.

Is the Dollar Rallying on Realigned Expectations?

Has the dollar's death been called prematurely?

Stalled exports from a an over valued euro is a slow burn down. In the near and maybe medium term the dollar will perculate. To get real long-term traction America needs to fix it's financial house.

The EU is about to find out if the twelve stars on their flag are in deed symbolic of unity and perfection.

Dollar Bulls: Increased Economic Tolerance

Hmmm.....not sure where you're getting your information from but according to the BLS (primary source) we've lost around 420k non-farm payroll jobs this year......not the 600k you claim.

Between 2001 & 2002 we lost around 1.9 million non-farm pay roll jobs. (BLS)

So I stick to my original contention that we haven't even come close to the job losses that occured earlier this decade.