And the Beat[Down] Goes On ...

Ahhh, let’s see ... recent buzz words in the investor vernacular have been risky assets,
subprime, inflation, decoupling, current account, globalization ... and the list goes on.

The newest buzz word to make the list: deleveraging.

I don’t have the hard stats, but I’d be willing to bet the instances of ‘deleveraging’ have
increased exponentially if you were to search for the term on Google today versus two
weeks ago. The simple reason is that it explains the ongoing US dollar rally.

Just when it started to look safe for a dollar correction...

Though we luckily have not had the experience, and the physical pain is obviously
different, this move in the dollar today seems to us the psychological equivalent to
being chomped on by a 20 ft. long white shark. Blam! Right from out of the blue depths
and you are mangled even if Mr. Jaws is just playing with you.

Central Bank Interest Rate Decisions Back on the Radar

If you’re a currency trader that became tired of only hearing about interest rates ... or
tired of only hearing about the carry‐trade dynamic ... or tired of only hearing about
yield differential as the primary force impacting the foreign exchange market, then the
global lending crisis and impending economic meltdown has offered a refreshing change
of pace!

An Attack on Friedman from the PC Crowd

I received an email yesterday, from a very smart man who happens to be a professor of sciences in one our top institutions. He wrote: “Been stunned by the number of free market folks who squeal for interventions. I am appalled at the looting.” Free market capitalism is now under attack from every two-bit “progressive” seemingly everywhere. It seems as if the US is swerving ever more deeply into the world of Ayn Rand’s Atlas Shrugged—the looters want control and seem to be taking it.