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Strategies & Market Trends : Currencies and the Global Capital Markets -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (3189)	12/31/2001 5:45:57 PM
From: Hawkmoon	Read Replies (1) \| Respond to of 3536

I really liked the Euro until I read that Greenspan likes it, too. Yeah... one has to be some contrarian with regard to AG's comments about the Euro. He gave it an "atta boy" on one hand, and then slapped them politely across the face by discussing how investors continue to prefer holding USDs because the feel the US economy is better geared to create economic gains than is Europe. "The steady flow of capital from Europe to the United States in recent years is, presumably, the consequences of Europeans finding many investments in the United States persistently more attractive than those at home," he said. "The persistent strength of the dollar in the face of the United States' unsustainable current account deficit underscores this impressive propensity to accumulate dollar investments, relative to those denominated in euros," he said. Greenspan said U.S. firms are more willing to adopt new, productivity-enhancing technology in part because they face fewer restrictions on the hiring and firing of workers than their European counterparts. Answering questions later, Greenspan expressed some surprise that productivity has advanced even in the face of an economic slowdown that turned into an outright contraction in national output during the third quarter, when gross domestic product shrank at a 1.1 percent annual rate. The Dollar was stronger again today, mainly as a result of lower equity markets and money slushing over into money markets which, btw, apparently now total over $4 Trillion, or almost 1/2 of annual US GDP. That's money which will be looking for better returns that US T-Bills. But it will be hard to find many big caps that can beat earnings expectations in the first 1/2. And gold isn't currently an option in this environment of deflation. Hawk