I say nasty because the pound said to us (actually more like screamed), “YOU’RE WRONG!”
This week we tried playing the British pound in our PositionTrader FX service. And while we’d played the pound several times already this week in our SwingTrader FX service, the most recent attempt added some power to the sterling smack in the face we’ve taken.
We are looking for a little rebound in the euro, despite our longer term view it goes to low 1.20’s this year at least.
“The euro gained ground, helped by news the day of reckoning for Greece has been postponed until the middle of March,” reported The Wall Street Journal today.
Errrrrttt…That was the sound of tightening; if I knew Chinese, I would give you the translation. I guess there’s no need for that, as the markets seem to be translating it just fine this morning.
China surprised the markets with an announcement they would tighten reserve requirements yet again in an effort to reign in some bubble-iscious-ness thanks to excess credit pumped into the hermetically sealed kingdom, i.e. capital controls, among other types. The dollar, gold, oil, stocks, and the bonds played along with the script…with buck moving higher, while the rest of the pack went south.
Jack laid out several items yesterday pointing to potential for a double-dip into recession land, for the US and abroad.
Sure, there are plenty of people out there that agree with Jack; I’m one of them ... and apparently Marc Faber is too! (Gee, I’m pretty funny sometimes.)
But there are also those who think the recovery is set in stone, done deal – we’re going to make it out of this just fine.
1. Because people like me are deleveraging. I sold my car because it was just sitting in the driveway; I don’t go out much given how much time I spend on the screens. I likely would still have the car in a world where credit was plentiful. I am sure millions of people all over are doing the same type of thing and spending less. That type of action is a major drag on GDPs and demand for Chinese exports.
