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

To: mishedlo who wrote (84572)	9/4/2008 7:49:43 PM
From: SouthFloridaGuy	2 Recommendations Read Replies (1) \| Respond to of 116555

Usually dollar strength is a sign of U.S. economic strength. The fact that it is happening in the midst of a global slowdown is unprecedented and in my mind couldn't have happened at a worse time for Bernanke. If Bernanke had used the Fed as a liquidity provider instead of using Fed Funds as the primary mechanism to deal with the banking crisis, we would have been in a better position to devalue the dollar at this point of the cycle like Greenspan did 2001-2003. Now the dollar is acting no different than the Japanese Yen or carry-trade currency where the borrow has to be paid back. Meanwhile, those 350 basis points of Fed Cuts did little to nothing to bring down borrowing costs for all but the very, very best borrowers who didn't need it in the first place. Idiotic Fed Policy has all but assured us a deep recession and muddle through for another 2-3 years thereafter, IMO.