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

To: gregor_us who wrote (3493)	1/21/2008 9:37:14 PM
From: Box-By-The-Riviera™	Respond to of 71475

very interesting. very.

To: gregor_us who wrote (3493)	1/21/2008 10:15:37 PM
From: Real Man	Respond to of 71475

Gregor, thank you for a nice essay. That's very interesting, and I completely agree! The only thing is the "ferocious" dollar rally of 2005 was, perhaps, due to the Fed raising rates from 1% to 5.25% starting in June, 2004, while the rates in other major economies stayed low. Then, as the Fed stopped raising, while other CBs raised, the dollar started its fall. Richard Russell seems to be very pro-gold these days. It is certainly hard to understand what exactly will make the dollar rally now that the interest rates are dropping again. A temporary foreign/carry trade influx of cash into long T-bonds and agencies due to recession rally? That's the only thing I can think of. That said, the bounce is pretty weak, yet folks are blowing a huge point out of this bear market bounce, Gold just made a new high a few days ago, and rallied fiercely since August. I guess a seasonal weakness in gold caused by reduced jewelry demand (actually, it proves gold is NOT a bubble, since jewelry demand still greatly exceeds any investment demand), and a drop of, say $100, will provide great arguments for the dollar bulls. I just don't see it until - until the trade deficit starts improving dramatically, which, by the way, is NOT happening. Some flatness, and a very minor decrease is going on.