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Strategies & Market Trends : Mish's Global Economic Trend Analysis
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To: Crimson Ghost who wrote (26929)4/6/2005 1:22:53 AM
From: regli  Read Replies (1) of 116555
 
"the Euro is flat today despite increasing doubts about future EU monetary and fiscal discipline."

I find this amusing. Now where is the fiscal discipline in the States? The overall deficit in the EU area is at present 2.7% of GDP and in the U.S. at approx. 5% of GDP if we use debt. The EU states also have a much higher savings rate than the U.S.

In addition the EU has a current account surplus vs. a huge deficit in the States. Just because the EU has shown that it is fiscally not as disciplined as they were, what makes the buck such a great investment?

The Yen is a much more questionable investment fundamentally though again the Japanese have a current account surplus and a significantly higher savings rate.

I understand momentum but on any fundamental level, I simply don't see why the buck should do well at all. I also don't understand your comment about EU monetary policy. Has the ECB indicated that it wants to lower interest rates?
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