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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: yard_man who wrote (152)	2/17/2004 8:42:02 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

Question to Heinz on the US$: "Unless CPI picks up ( relative to PPI ) , I'd expect weaker US GDP figures going forward. Where does that leave the dollar?" Reply from Heinz: you have correctly stated the problems producers now face - they can't pass on sharply rising input costs. however, as to the dollar, the main ingredient that is needed to stop and reverse the dollar's plunge is a reversal in the current account deficit to the unch. level - and this can, and will, be achieved by means of a severe recession. so as counterintuitive as it may seem, economic weakness is actually a sine qua non for a trend change in the dollar's external value.