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Strategies & Market Trends : Zeev's Turnips - No Politics

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To: Crimson Ghost who wrote (68972)5/17/2002 8:39:37 PM
From: KyrosL  Read Replies (3) of 99280
 
George, an orderly decline of the dollar will not necessarily be bad for US stocks.

From 1985 to 1992 the dollar index declined from a high of 160 to a low of 80. During that time the stock market did very well, even with the interruption of the crash of 1987.

An orderly decline of the dollar will alleviate the main macro distortion in the US economy: the huge trade deficit. At the same time, it will help revitalize US industry and absorb the refugees of the nineties tech boom.

A problem will arise only if the decline is not orderly.

Kyros
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