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  • Big Al Talks Deficit Financing...

    In This Issue..

    * Currencies hold gained ground VS dollar...
    * Swiss franc really shines!
    * Japan borrows a line from the U.S....
    * The Labor problem grows...

    Good day... And a Happy Friday to one and all! A Fantastico Friday, especially if you are a Los Angeles Lakers fan! Me? I've always been a fan of the Celtics, but since it's a long distance directory assistance relationship, it's not that big of a deal to me that they lost. When I was a kid, the Hawks were in St. Louis, and we won a championship, with Bob Pettit... OK, I was only 3... But my dad loved to talk about it!

    Well... We've had a day where the currencies gained VS the dollar, and then held their ground, for the most part... No profit taking, no debt crisis fears trading, just held their ground VS the dollar... Now, some would say... 'that's a sign that they've hit resistance and can't overtake it, which is not good for a rising asset'... But, me? Well, I would say, and will say... 'I find this to be refreshing. The last thing you want to see is an asset, which in this case is a currency like the euro, run up too much, too fast, for that WILL give the markets reason to sell. I prefer the slow gradual, stealth-like moves in currencies, so that they don't gain any attention, until the rally is well established.'

    ...
  • Jobs Disappoint Again!

    In This Issue..

    * Euro falls below 1.20...
    * Did we have negative "real" job creation?
    * Canada's labor market is strong...
    * G-20 yields nothing...

    Good day... And a Marvelous Monday to you! It was a wonderful jam-packed weekend for yours truly, and when the alarm went off this morning, I had a greater appreciation for 3-day weekends!

    Well... Friday, when I was signing off, I said that suddenly the currencies were getting sold... At that time, it looked as if it might be short-lived... But NOOOOOOOOOOOOOO! This was an all-out assault on risk, folks... At when the dust settled in the early afternoon, the euro had fallen below 1.20, for the first time since 2005, and everything other currency was getting whacked too... For the first time all week though, Gold rallied......
  • Wild Swings!

    * Euro gains, then loses, then gains... * Inflation and Commodities... * The euro turns 10! * Risk Aversion remains but is waning... ** Wild Swings! Good day... And a Terrific Tuesday to you! Well, it happened way too late for yours truly to witness it, but my beloved Missouri Tigers rallied and won the Alamo Bowl in overtime. Go Tigers! Hopefully they can fix the defense before next fall! OK... Remember those Wild Swings I talked about yesterday? The Wild Swings that could be a result of thin volumes in this the second week of Christmas. Well... We witnessed them in earnest yesterday! As I signed off yesterday, I told you that the euro had rallied 2 whole figures to 1.43 and change. Well, that rally dissipated throughout the morning, and by late in the day the single unit was 1.39 and change... WOW! Now that's a Wild Swing! You can point to profit taking as the reason for the move, and with the volumes thinned out by Holiday trading, one profit taking sell begot another, and before you knew it, the euro was looking at a loss on the day....
  • Don't be fooled by the US GDP...

    * Don't be fooled by the US GDP... * Canada, Mexico, and Brazil rally... * Aussie dollar falls... * Japanese to keep rates unchanged... ** Don't be fooled by the US GDP... Good day...And welcome to the last day of July. The dollar held its ground through most of the trading day but started to sell off as the day wound down. The currency markets seem to be stuck in a summer doldrums, with few dramatic moves. With many of the head traders enjoying a summer break (ours included), currency desks are reluctant to take on large positions. And who can blame them as the recent global economic data has left investors wondering where to turn. As I have explained to several recent callers, the global economy is experiencing a slowdown as the high commodity prices and a slumping US economy has hurt growth. The economic releases have shown an overall slowdown in growth, and rising global inflation. But the overall slowdown will have differing effects on the currencies. Asia is slowing, but a slowdown from double digit growth in China and India is much different than a slowdown in the US where growth is around 2%. Also, the Asian countries have kept interest rates low to try and keep their currencies from appreciating too quickly. These countries are therefore in a much better position to combat inflation, and can allow currency appreciation to help combat rising prices....