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Strategies & Market Trends : 50% Gains Investing -- Ignore unavailable to you. Want to Upgrade?

To: Sober who wrote (79819)	7/6/2009 4:36:06 PM
From: Keith Feral	Read Replies (1) \| Respond to of 118717

Maybe China should make their own currency a reserve currency and start lending money all over the globe like the US and Europe. I can't ignore some of the obvious market mantras about oil prices going up because the dollar is getting pounded the past couple of months, and I can't ignore the fact that the dollar went up last fall when oil was getting shellacked. However, when the market bottomed in March the dollar had a nice surge along with everything else. A cheap dollar seems to solve just about most of our deflationary problems, but I don't think a stronger dollar in the face of an economic recovery will prevent oil prices from rising. FDX was making a macro call that the second half recovery is well under way, as per Cramer. They are pretty good at forecasting, so I'm willing to keep focusing on the economy coming out of it's slump this summer. Eventually, that's going to be bullish for the dollar. If a rally in the dollar slows the pace of oil, great! It almost seems like the biggest thing holding the market back is the obnoxious correlation to the price of crude and the market. However, I'll use the pullbacks in crude as a buying opportunity for investments. Also, the pullback in bond yields seems to have a bit of silver lining these days. Instead of traders talking about a flight to quality, the market seems to focus on lower mortgage costs. Maybe the longer we stay deflated, the better the chance for economic recovery. At the end of the day, though, nobody is going to start hiring until the economy does improve. The market isn't going to collapse if traders sense the economy is continuing to get less bad, as most of the economic indicators seem to suggest. I just wonder if people are prepped for an economic recovery. Earnings will be improving in 2010 for the first time since 2006 to 2007. It sure looks like most companies took care of the cost cutting they need to remain profitable as we come out of the second recession this decade. Citi and AIG are still dubious, but they have been removed from the DOW. If the earnings are there, the economy will follow. However, the concerns about job creation will continue to linger. The biggest problem with the economic collapse was unsustainable real estate prices in residential and commercial real estate. I think the collapse in pricing will create a more stable economy at both levels on the other side of this mess. Overall, the private sector seems to have adjusted to the new diet plan pretty well. The longer term issue will be with government budgets. However, if the economy is back on it's feet in 2010 at the corporate level with normalized earnings, that put's a lot of tax revenues back into the system.