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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Grandk who wrote (82583)	6/12/2007 10:29:31 AM
From: andiron	Respond to of 110194

i think dollar (trade weighted) goes higher even as it falls against RMB and that would be a good thing.. It smells like unwinding (Goldman is nervous?)

To: Grandk who wrote (82583)	6/12/2007 11:17:54 AM
From: John Vosilla	Read Replies (1) \| Respond to of 110194

Does dollar vs yen hold any meaning these days? It was high like now when this bull market started early 2003. It was low when the market last cracked first half of 2005. Today we are at the top of the range again.. finance.yahoo.com

To: Grandk who wrote (82583)	6/12/2007 12:51:57 PM
From: GST	Read Replies (1) \| Respond to of 110194

The precarious position of the dollar relates to the risk that our debts cannot be so easily financed as they have been up until now. We have been beneficiaries of cheap oil, cheap credit and cheap labor. Those three supports for our economy are in the process of evaporating. That leaves us with higher borrowing costs due to a weak dollar, a rising current account deficit as we pay billions of dollars in interest to foreign financiers on the trillions we owe on top of our government deficit and trade deficit, and inflation driven by higher commodity prices, higher labor costs from imports and higher costs due to a falling dollar. This is a recipe for stagflation -- a falling dollar, rising interest rates, rising inflation (meaning a persistent trend towards higher prices in US dollars), and a slowing economy.