AndrewBaker

Wall Street Breakfast: Must-Know News

The dollar won't slide catastrophically because there is no other currency to replace it right now, not because it's intrinsically worth holding more than other currencies, but it will decline over time, just as the British pound did from the beginning of the last century and for most of it.

A weaker dollar helps exporters and tourism, which is good, but hinders the growth of emerging economies, which may slow them down a little, but won't stop the trend.

On balance, the US needs a weaker currency to support trade which will help real businesses recover. Not so many people will currently be insistent on spending money on foreign goods or looking to increase their overseas vacationing, so any extra cost there won't hurt much. Imports will be more costly, but the US has a wide internal market that can supply most needs anyway.

Overall, a drop in the dollar will likely be beneficial. Better that than rampant inflation which will destroy value over many years to come, and which worries me will be the result of quantitative easing. If a weaker dollar reduces that process, I will be satisfied.

Wall Street Breakfast: Must-Know News

Well, everyone is waiting for the Fed to speak about the economy and the result of the auction of the bonds being sold this week: I would be surprised if both didn't get presented as good for the recovery. With the markets down yesterday with profit being taken, they are ripe to pick back up again later today and maybe continue to the end of the week. Vacation time means that no great volume is needed to move things either way, and we already know that the powers-that-be want a northerly direction, so I'm staying in for now and booking my profits later.

I have gold and other commodities too as support.

Wall Street Breakfast: Must-Know News

Yes, sell - or short - in May looks like being good advice. The bad news in the financials will slowly be leaked out over the summer so there will be even less reason to buy stocks then. There is a limit beyond which the markets cannot be falsely inflated, and that limit must have been very nearly reached by now. I'm enjoying pulling back a little of my rally losses with FAZ, SDS and similar right now; and my unleveraged shorts will tick away nicely for some time yet, thank you.

Wall Street Breakfast: Must-Know News

Yeah, it's been said: the political and financial elite don't care beyond their need to save themselves. Prepared statements and speeches saying how dreadful it is and we must all work together to overcome; yet they carry on in place, without real restitution, whilst we have to work that much harder to cover the money being handed out to people who caused the mess in the first place. I wish I had an answer, and if I did, they would not be in it!