Worldwide Financial Crisis Offers Relief for the Dollar
The dollar continues to rally amidst the worldwide market meltdown. What started as a financial crisis in the United States in early 08 has spread across the globe and now investor sentiment has changed. Perhaps our currency really isn’t so bad after all?
The further the worldwide markets fall the more the US dollar strengthens. All common sense would point to this as a misunderstanding for how could anyone have confidence in the dollar during a time like this? The reality is that it wasn’t just the US that drank the kool-aid, so no longer can we be singled out.
Take a look at the chart below of the $US dollar index. Note the move that began in mid July which hasn’t slowed down much since.
Commodities as a whole have been the biggest losers as a result of this rally. Some of the hottest market trends of the last year are now just a memory due to the market as a whole and now the dollar making its comeback.
Blain – have you read Crash Proof by Peter Schiff?
He nailed this entire move down, except he thought that the dollar would collapse and that gold would go to 3K. He bet heavily on gold, on the euro and on commodities.
It must stink to write a book and precisely call out what would happen with real estate and the stock market, only to miss one element. That small detail causes your clients to be submerged underwater with the rest of the blind money managers who were caught off guard.
The U$D is insanely strong here on the “new” news that Europes economy is probably worse then ours.
Ya so much for the commodities boom. Very interesting viewpoint Blain.
Buffet had the dollar collapse called as well, as far as Crash Proof $3k gold would be quite a site to see
Interesting take Blain, time will tell