Mr. Bernanke called again
Written by A Forex View From Afar on Wednesday, January 09, 2008Please add your Comments in our Forum.
Mr. Bernanke was called again, on 17 January to testify about the economy, by the Congress. In case you didn't see the fist meeting, you really should. Ron Paul did quite a show. We can only hope he will be there.
(For those who don't know what we're talking about:
http://www.youtube.com/watch?v=yAwvlDJgJbM)
Getting back to currencies and macroeconomics, after Goldman reported yesterday we are going in a recession this year, Merrill Lynch say we are already in recession. This is the first major bank that says we are already in a recession. Probably more to follow...
Again, getting back to currencies, it seems that the dollar gets real support from the Bond traders. The dollar index made a small bottom this week, last stop before 75.
There are a lot of traders out there, that think the US economy will boom from a weak dollar and the markets are really expecting this. But to their disappointment, it seems that things aren't like this.
Ford just announced they'll cut jobs and production in the US in search of profitability, while Goldman Sachs cut earnings for all US vehicle manufacturers.
It seems that a weak dollar doesn't support the car manufacturing industry; the overseas investment in 'US' car manufacturing repatriates Dollar profits and sends them home. The US component may add up to the badge and the design.
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