Monday, May 2, 2011

U.S. $

The U.S. $$ has been going down like a rock in a pond. The price decline versus the other major currencies since 2010 has been unprecedented.

Markets, including currencies, do not zig and zig and zig... they zig and zag.  I don't know exactly when the US$ will find a bid, but I do think it will happen relatively soon.  The End of the World is not upon us - yet.

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Just because I think the US$ and the world are not coming to and end doesn't mean that I think our system won't grind average "Joe" into the muck and mire - I do think that. My response is is to not be "Joe"; its still good to be King, however you define that, and its more fun, too.

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Osama Bin-Laden Dead. Even with my rock hard belief in the sanctity of Life, I am having a hard time feeling that this killing was wrong. I did not lose any friends or family on 9/11 but I knew many of the people that died in the Towers from my time working in the Securities industry. I hope that their families, and all of those killed by al-Queda and like minded organizations experience a bit of closure in this.

Of course, there will be consequences; unintended consequences. Killing will always beget more killing. The execution of Bin Laden will result in the ambush of American service personnel in Afghanistan. Somewhere in America, there is a mother who may be celebrating Osama's death... only to receive a knock on her door from a military chaplain and a Major General... and an American flag.

Still, my sense is that Bin Laden had worn out his welcome on this earth... and to our intelligence agencies and the military's credit, a message has been delivered, Israeli style, to those who would commit mass murder of innocents. Rot in H***.

"I've never wished a man dead, but I have read some obituaries with great pleasure." - Mark Twain

Yours for a better world,

Greg

11 comments:

Anonymous said...

I'd guess that the dollar may turn soon. China is experiencing serious inflation. Japan is printing to recover from the tsunami. Europe's debt crisis will not go away. Yet, the dollar is getting massacred. The rate of decline is picking up too. I'd expect a sharp drop followed by a rebound and slow drift up.

We may be bad, but everybody else is looking worse

Regards,

Coal Guy

Greg T. Jeffers said...

"We may be bad, but everybody else is looking worse"

That, and it is the mirror image of the end of the commodity bubble.

Not to worry, the Fed and Treasury has shown they are willing to do ANYTHING to achieve their policy objectives... count on them being brutal to defend the $$ at some point... BRUTAL.

Anonymous said...

I agree that the drop in the dollar has been overplayed. IF being the reserve currency was such a benefit, everyone would want the status. Instead you see all this posturing to try to force the U.S. to firm up the dollar. From what I see it creates a negative trade deficit for the nation holding that so called “privilege” of the reserve currency because every third world country pegs their currency below the dollar.

As for Osama, I don't find anything immoral in killing that sack of crap. It might have some consequences, but all things do. It would be worse if we would have never murked him. I will give the President some props for making a unilateral act and bringing that bastard to justice. I really think this is an opportunity to declare victory in Afghanistan and pull out. We destroyed al Qaeda and the Taliban and it is seriously unrealistic to expect them to go to an American style democracy. The terrorist cells in the Arabian Peninsula are the real problems now when you are actually talking about capabilities.

Dextred

Anonymous said...

"We may be bad, but everybody else is looking worse"

That is my thinking too; anybody who has ever ran a business knows the customer is key, if you ain’t got customers you ain’t got a business. Ultimately every job is dependent on someone selling something to someone else. Extrapolating that micro view to the macro, I think those exporting economies that everyone goes gaga over are screwed. Who are they going to sell to? Us? The PIIGS?

As for precious metals, I tend to think that they will continue to do well until the stress on our economies is gone, or at least greatly reduced. PM can be my asset without being anybody else’s liability. That is not saying they will zig and zig, just that the zags will be smaller and tend to be horizontal as the dollar recovers relative to other currencies but not with respect to PM.

Best,
Dan

Donal Lang said...

Am I missing something here? I can see loads of reasons why the Fed wants the dollar to fall and fall. I can't think of a single one (except national ego) why they'd want to stop is falling.

Anonymous said...

Donal,

I agree 100%

Regards,

Coal Guy

Greg T. Jeffers said...

The administration needs the $ to strengthen to survive the election.

Greg T. Jeffers said...

BTW... there is a difference between the $ vs the other currencies

and

the $ vs commodities. Vs other currencies, the $ will rally... against commodities? The $ will rally harder.

I like energy equities, but I like them at lower prices. So I sold out of the money puts AND out of the money calls. And I might be wrong, and reserve the right to change my mind.

Donal Lang said...

Albeit from a distance, I don't see a weak dollar as a simple-negative as an election issue; exporters love it and it creates jobs, it doesn't make much difference to retired folk (interest rates are more important) and enough intelligent people see the sense of it to vote to continue it. And the others (Republicans!?) will never vote Obama anyway!

And Obama did for Osama! Beat that, Trump and Palin! (Are you guys SURE you want to go that route? Really??? ;-)

Donal Lang said...

P.S. I always thought Osama was hiding as a taxi driver in New York!

Greg T. Jeffers said...

Dex:

Your $$ analysis is spot on, in my humble opinion.

BTW, stop stealing my thunder!