I'm a little lost on what's going on in the dollar. Bullard's comments are bullish. Mideast usually a flight to quality. Now I started searching around to make sure I wasn't going crazy and of course cnbc doesn't have shit except that Cramer broke wind today and I guess that's bullish. FT helped bring my sanity back and according to the few FX guys they talked to, they're not sure either. Someone smarter than me want to fill me in? Smells like a MAJOR change in fundamentals or Fed's looking at QE3. I'm leaning heavily toward the first one (fundies). Thanks!
not sure what you mean when you talk about bullard's comments being bullish. what about his comments were bullish for the usd?
Agree. US dollar is toast.....just waiting for it to sink totally......FED and Congress moving deck chairs not much help now.
he discussed pulling the plug, and/or easing back on QE2 to see if the economy can sustain itself. Basically whqt I got from it
right. Surprisingly it seems like it's been nothing but talk until now though. The big worry is the reserve status. I don't want to see that go. :/
these were the brilliant statements i got from him: * Fed is not an exporter of inflation and not to blame for inflation in emerging markets * It would be unwise for the Fed to overreact to recent commodity price pressures * Current Fed policy is in the interest of the world's economy * Rates likely to stay low for extended period * Several areas of vulnerability for US economy, and sees need to be ever watchful for any price bubbles apart from the complete removal from reality and embracing of stupid, everything there looks dollar bearish. mind you these are actual statements. you couldnt write dumber comments if you were making them up.
It seems to me the flight to safety is there. Safety being swiss franc and gold against all currencies (prior to today that is). What may be confusing you is the risk trade is still on. Equities,commodities are all up and that means dollar short. As long as the S&P is up look to sell dollar. High oil prices is the only thing that the Middle East can do to impact earning and profit. We did see this early last week. It seems that the market didn't really consider the events in Libya to be a huge impact after the Saudis said they'll pick up the slack in any loss of oil exports. (Egypt is not a big oil exporter, therefore no impact during their party.) That's not to say that euros trouble are behind them. I thought the elections in Ireland would have dragged the euro down today. Maybe it did as the EURGBP fell. I'm also starting to hear more talk about Italy. This or something new out of Portugal could easily cause the risk trade disconnect from the dollar. My 2c
http://online.wsj.com/article/BT-CO-20110228-709031.html I saw other comments making it sound a little more urgent http://www.forexlive.com/169742/all/update-2-fed-bullard-could-end-qe2-shy-of-600bn-take-stock