>But with the dollar 25% cheaper than it used to be, it seems like a good part of the dollar move must already have happened - why should they jump now?
And where exactly would they jump to? Neither Europe nor Japan look particularly attractive.<
Everbank's currency columnist, Chuck Butler, recently addressed these issues:
"The Bush Administration, in their drive for votes, right or wrong, have thrown the dollar in front of the bus, and have wished for it to be ... So, the markets are more than willing to oblige them! And is the case always with any market, stock, bond, metals, currencies, etc.. The move will go way past "fair value"... So get prepared for the worst if you are still a dollar bull..."
and --
"My good friend and former boss, wanted me to comment on the phenomenon going on right now with stock prices going higher, but the dollar circling the bowl... Kind of strange he thought... Yes, it is kind of strange, but from what I can see, the stock buying is being generated strictly from U.S. buyers... Foreigners are still sitting this one out... So far... Which, if I were them, I would be too... I would let U.S. buyers run up the stocks, then I would sell, not only the stock but the dollar, and take my currency and profit home! But that's just me role playing a foreign investor!" |
