Disappointing News Sends Dollar and Stocks Lower

January 27, 2015

Juno was downgraded to sub-blizzard status.  N.Y.C. is likely to get just a foot of snow, and the stock exchange opened as scheduled but with a thud, as the Dow dropped over 1.0%.  In Europe, equities have declined 5% in Greece, 1.4% in Germany, 1.2% in France, 0.9% in Spain, 0.8% in Britain and 0.6% […] More

Euro Weakened Further

January 8, 2015

The dollar is trading currently near its new peaks of $1.1754 per euro and CHF 1.0218.  The dollar is now 0.7% higher against those currencies than at Wednesday’s close.  The dollar also rose 0.6% against the yen and 0.3% versus sterling but has fallen by 0.3% relative to the Australian dollar and 0.1% against the […] More

Dollar Uptrend Substantial Already

November 12, 2014

Despite deepening concern about the euro area’s economic outlook, the dollar’s recovery versus the euro understates the U.S. currency’s overall turnaround.  EUR/USD had declined slightly less than 10% since the start of 2014 but only 5.5% since the end of 2012.  Almost 7/8ths of a 33% plunge in the Russian ruble since end-2012 happened this […] More

Financial Trick or Treat

October 22, 2014

The ‘Trick or Treat’ greeting of Halloween revelers offers a choice of extremes.  The handover of a holiday sweet is a happy moment for giver and receiver alike, while the contrary exchange of an act of vandalism for getting no candy leaves all parties dissatisfied.  There’s no middle ground, and so it has been for […] More

Bolder Official Efforts to Influence Currency Movements

September 25, 2014

Officials outside the United States had for some time been frustrated by the weakness of the dollar in spite of superior U.S. fundamental economic comparisons of real growth, labor market conditions, and interest rates.  Now that the Federal Reserve’s third round of quantitative easing is wrapping up and speculation is heating up about an initial […] More

A Strong Dollar Is in the Best Interest of Everybody Else

September 11, 2014

In the mid-1990s, former U.S. Treasury Secretary popularized the phrase that “a strong dollar is in the best interest of the United States.”  What he meant was that if the dollar is expected to appreciate, it will suppress actual and expected U.S. inflation, reduce long-term interest rates, promote business spending and direct investment inflows by […] More

September Introduces New Stuff to Watch in Currency Trading

September 4, 2014

The ECB announced some meaningful stimulus today.  The Bank of Japan, which made its big play, is now the central bank in need of stimulus that seemingly fallen behind the curve.  The tone of U.S. data has progressed this year from disappointing to mixed to, most recently, increasingly positive.  And the dollar this week has […] More

A Modest Proposal

August 14, 2014

Tomorrow will mark the 43rd anniversary of the most famous event in modern currency market history.  I refer to former President Nixon’s decision to sever the dollar’s link to gold.  The dollar devalued four months later in a vain attempt to reestablish fixed parities.  A second dollar devaluation followed 14 months afterward in February 1973, […] More

Might the Dollar Finally Be Embarking on a Substantial Uptrend?

August 6, 2014

For some time now, the potential for significant dollar appreciation against other advanced country currencies has been widely apparent based on divergent monetary policies and the greater economic vulnerability of Europe and Japan to a geopolitical landscape that’s deteriorating by the the week.  If the dollar is has begun a big move, these remain early […] More

Governments Challenged

July 24, 2014

It a conventional to think that currencies are apt to weaken when governments fail to meet important challenges properly.  Governments these days are struggling to deliver prosperity, peace and world respect.  Soft productivity growth is one of America’s central problems.  It prevents faster growth in jobs from boosting GDP growth, and it could force the […] More