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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: Real Man who wrote (495)	7/22/2007 8:16:04 AM
From: stan_hughes	Read Replies (2) \| Respond to of 71454

I became convinced and posted somewhere in the spring that Japan would not raise rates ahead of their July 29th election whether it appeared warranted or not -- that was the correct call, and no way they are going to do it now in the week beforehand After July 29 the global winds might see a big shift

To: Real Man who wrote (495)	7/22/2007 4:52:29 PM
From: RockyBalboa	Respond to of 71454

Vi, the pound is so strong and even gained a little vs EUR because the brits have done a lot of repair work in the last 10 years or so, since the pound blew up. Particularly, they may have a trade deficit but the question is - with whom (European trade deficits don't count). But they have a reasonably federal budget in contrast to the US which runs large domestic deficits as well. but in some part you are right; as a result of still being the finacial capital (at least of Europe) asset prices particular RE keeps rising and defies any gravity. But overall it is the carry trade theme revisited. Pound mimicks the EUR but carries nearly 2% higher interest rates so, investors prefer it over EUR when it comes to Yen (and CHF) selling. I still think that the Japanese bank is doing something rather soon, particularly in order to prevent further JPY declines. "At the press briefing Fukui left the impression that he is doing everything possible to remove every remaining obstacle to a rate hike. Time and time again Fukui stressed that the BoJ can hike rates even if consumer price inflation remains slightly negative. ... Very importantly, Fukui for the first time expressed some concern about the excessive decline in the JPY and "one-sided bets against JPY". This could indicate that the BoJ could turn increasingly aggressive on the JPY and let it influence the interest rate decision if the currency continues to weaken." Yen didn't dip anymore after the BOJ left rates unch. fxstreet.com