2.29.08
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2.29.08
The week started out strong but gave some back on Thursday and really got beat up on Friday. The real problem was the Fed Chairman Ben Bernanke testifying before Congress put pressure on the Dollar which in turn caused overseas Markets to go lower. The truth of the matter is that it now takes around $1.50 US to buy what 1 euro will buy. As you can see when you stop to buy gasoline, what you use to pay a $1 for is now costing 50% more. And this applies to all goods, milk, bread, beer, and so on. After looking like it may have bottomed a few months ago, the dollar has been breaking down to new all time lows, and apparently Ben Bernanke likes that. It really only hurts the U. S. economy as we must spend more for imports. There is no shortage of oil, the culprit is the weak dollar. The Fed right now is more afraid of inflation than a weak dollar, but the weak dollar causes a form of imported inflation. The Fed finds itself between a rock and a hard place for sure. We are again staying on the sidelines with 100% CASH. There is still a total lack of predictability in the market. Till next time MTA Staff |
