The media has it all wrong on the USD-Oil relationship

goldman sachs has research indicating that oil is not going up because the dollar is going down. just the opposite, oil is going up and since oil exporting nations are participating on the long side of EURUSD pair the dollar is going down as consequence
http://www.rgemonitor.com/blog/setser/252559/

 

Is this the same Goldman that said earnings results for the last two weeks was going to be abysmal?

 

interesting article. thanks for posting it.

 

Hen or Egg first ?

 

Ah, so now its all explained. The dollar is not linked in any way to the confidence of other countries in the american economy, but solely with the performance of oil.

 

those things are linked. a current account deficit(of which oil is a bigger contributor) gives the ownership of the national currency to foreign entities, what they do with it will determine if the currency will decline. GS is indicating that oil exporting nations are buying euros with part of their revenues

 

I wish Goldman would let Abby Joseph Cohen out of her kennel to explain difficult concepts like this.

Why did they lock her up?

I really miss her cutting edge, timely and spot on commentary such as "I see a lot of value out there....".