nnuut's Account Talk

Good article!:D

Ahead of the Curve


The Real Reason to Worry About the Dollar


By Donald Luskin

SHOULD WE BE worried about the U.S. dollar falling to all-time lows vs. foreign currencies? Does it matter to investors?

Yes it matters, and yes you should be worried — but not for the reasons that you may think.
First, let's get all the wrong reasons out of the way.
One reason you hear all the time is that the U.S. is growing slower than the rest of the world, so global investors want to move out of dollars and into the currencies of countries that are growing faster. Fine — China and some other emerging markets are growing faster. But compared to the mature regions that really compete with the U.S. for significant investment flows — Europe and Japan — U.S. growth, based on the latest GDP figures, is higher.
Another reason you hear all the time is the US trade deficit — that fact that we are spending more on imports than we receive for our exports. So how come the dollar's fall has accelerated over the last three months while our trade deficit has actually gotten smaller? I've never understood why a trade deficit is supposed to make the dollar less valuable. It just means some dollars have moved from here in the U.S. to the rest of the world. That's terrific — we get their manufactured goods, they get our little pieces of paper. I'll do that trade all day. And what happens when they redeem those pieces of paper for our goods and services? That's no problem — we'll have an economic boom providing all those goods and services. [much more] http://www.smartmoney.com/aheadofthecurve/index.cfm?story=20071109
 
Reading the foregoing article...I don't see any evidance for this statement:

"That means to me that the dollar isn't going to recover anytime soon, because the Fed is almost surely going to cut rates at least one more time, and the inflation risk won't get wrung out until the Fed does just the opposite — raise rates."

In the past the USM hve took off after 2 Fed cuts, not three.

I think the Fed was trying to avoid a lack of liquidity slowing down the economic engine. By lowering rates the export engine has started up bigtime. We ship goods to OSM and they give us currency converted to US which is more worthless, but they are getting a discount so they keep buying. Our companies turn into giant Costco's of the world and sell volume, making pennies on each widget. This process lowers the trade deficit and starts the USM economic engine.

Great News :
"Separately, the Commerce Department reported that the U.S. trade deficit narrowed unexpectedly in September to its lowest since May 2005 as exports set a record." Already improving and the full force of the previous rate cuts have not even hit yet.

http://www.cnbc.com/id/21705941

US companies cant make the goods fast enough and need capital to expand. But the high sell volume makes greater profit, so less investment capital is needed.

Once the ball is rolling the Fed puts on the brakes by slowly raising rates. USM hardly notice because they now have a repeat customer base and OSM hooked on this stuff. The value of the currency raises. :)
 
Reading the foregoing article...I don't see any evidance for this statement:

"That means to me that the dollar isn't going to recover anytime soon, because the Fed is almost surely going to cut rates at least one more time, and the inflation risk won't get wrung out until the Fed does just the opposite — raise rates."

In the past the USM hve took off after 2 Fed cuts, not three.

I think the Fed was trying to avoid a lack of liquidity slowing down the economic engine. By lowering rates the export engine has started up bigtime. We ship goods to OSM and they give us currency converted to US which is more worthless, but they are getting a discount so they keep buying. Our companies turn into giant Costco's of the world and sell volume, making pennies on each widget. This process lowers the trade deficit and starts the USM economic engine.

Great News :
"Separately, the Commerce Department reported that the U.S. trade deficit narrowed unexpectedly in September to its lowest since May 2005 as exports set a record." Already improving and the full force of the previous rate cuts have not even hit yet.

http://www.cnbc.com/id/21705941

US companies cant make the goods fast enough and need capital to expand. But the high sell volume makes greater profit, so less investment capital is needed.

Once the ball is rolling the Fed puts on the brakes by slowly raising rates. USM hardly notice because they now have a repeat customer base and OSM hooked on this stuff. The value of the currency raises. :)

Uptrend I agree with your comments on the rate cuts. I don't think it's a sure thing. Ben may do a turn around and use some Dollar Logic and start buying up dollars and raising rates. Boy would that surprise the Markets, and we all know the Markets don't like to be surprised, BUT I DO in this case!!:cool:
 
Bulls and Bear's will be
attachment.php
next week. Volatility is going to be fierce.
attachment.php
. Be very careful. Somthing tell's me we are going significantly lower.

:toung:
 
Yes I can say that I'm MORE than apprehensive about the coming week.
From what I understand by surfing around this week, if Asia has a Carry trade problem Sunday night it could trigger the World Markets to drop considerably. Will it happen, I really don't know cause as we all know I'm no Analyst. If we drop they say, if the breaks through the 1440, and crashes through 1430 to 1435 hold on to your bucks!!!
View attachment 2482
 
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Your chart looks very similar to this. :sick:

Video Dated 9/2/2007.

Thoughts ?

http://uk.youtube.com/watch?v=xKBM8Q_w0wg
There are many Prophets of Doom hanging around lately, with good cause. It has me almost convinced that we are on the BRINK. Is it too late to correct all of these inequities that are causing the problem, probably. I just don't know, but you don't have to hit me in the head with a brick to get my attention. Being very careful, too many indicators are indicating the same scenario.:cool:
http://www.tsptalk.com/mb/showpost.php?p=130686&postcount=2426 Try this if you haven't.
 
Re: nnuut's Account Talk (post #2399)
These are big money moves for sure and they are Day Trading, buying low and selling high, The difference isn't that much but the volume is tremendous, big bucks! Who is it, nobody knows!:confused: Who said that, I SAID THAT!!
Nnuut, I may have figured out a piece of puzzle we discussed a week ago - check below (posted to 12% yesterday): From: "My Yahoo"-Market Update, 11/09/07 (check link ASAP @ http://finance.yahoo.com/marketupdate/update )
-just as one example, that begs further questions, as I seem to recall similar days w/ CFC, Citi, BOA, etc.

3:00 pm: The stock market continues to trade near its best levels of the session following a late day surge in buying interest][Strikingly, like yesterday, the financial sector (+1.9%) is spearheading the late day rally. The reversal of financial sector is especially impressive considering it has rallied 4.5% from its intraday low.]
2:30 pm: An increase in buying interest has pushed the major indices to their best levels of the session since the opening plunge. The S&P 500 is now down only 4 points] [Buying interest is broad-based][Of note, Wachovia (WB 40.76, +0.46), which caused the sell-off of financials this morning, has made it back to positive territory!!!.DJ30 -90.72 NASDAQ -33.14 SP500 -4.42]

(I leave further theory/consequences to those who know sources for info)​
 
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Re: nnuut's Account Talk (post #2399)

Nnuut, I may have figured out a piece of puzzle we discussed a week ago - check below (posted to 12% yesterday): From: "My Yahoo"-Market Update, 11/09/07 (check link ASAP @ http://finance.yahoo.com/marketupdate/update )
-just as one example, that begs further questions, as I seem to recall similar days w/ CFC, Citi, BOA, etc.

3:00 pm: The stock market continues to trade near its best levels of the session following a late day surge in buying interest][Strikingly, like yesterday, the financial sector (+1.9%) is spearheading the late day rally. The reversal of financial sector is especially impressive considering it has rallied 4.5% from its intraday low.]
2:30 pm: An increase in buying interest has pushed the major indices to their best levels of the session since the opening plunge. The S&P 500 is now down only 4 points] [Buying interest is broad-based][Of note, Wachovia (WB 40.76, +0.46), which caused the sell-off of financials this morning, has made it back to positive territory!!!.DJ30 -90.72 NASDAQ -33.14 SP500 -4.42]


(I leave further theory/consequences to those who know sources for info)​
You're right, there sure was HEAVY buying and Friday broad based selling right at the end of the day. I really don't know who these buyers and sellers were but I suppose they had a good reason to put that much money into the financials right at the end of the day. What could be their reasoning? I can't see where the situation changed that much at the end of the day, only that they started BUYING or SELLING huge amounts of stock. It happens all the time. I think it's about making money, simple as that!:cool:
 
Nnuut,
I think its as simple as that too - all these institutions are wanting to trim as much losses as they can. This is one way to make up some quick dollars. Its not near enough as they need, but maybe (just maybe) it is helping keeeping some afloat?? Its sure messed with all our heads the last couple weeks, but may at least explain some of the craziness. Maybe 12%'s last news on these Banks getting together (crating a pool) is a success. Think that may start to ease crazy market activity - or they will continue daily market manipulation (calling it what it really is!)??
VR
 
You said it, I will be watching the Asian Markets tonight! Still hoping it will work out and we can get a bounce. Just have to wait and seeeee!:worried:
 
Very interesting nnutt, Thanks... I added it to my fav's... What can I say,

If we roll over the moving averages, I think we are in for some serious

selling.
faint.gif
 
Nnuut,
I'll be watching Asia Markets too - fairly key tonight.
Maybe tonight even more intiguing than usual as result of your post:
Re: 350Z's I fund thread NOV 07
Happy Vets Day to US!!!:D
And... China is taking action to fight inflation, by taking money out of the economy, locking more of it up (as a gov't reserve). The US might think about this, wouldn't you think?:worried:
Nice point - may help, and wonder if we may see tonight!
_39292458_yuan_body.jpg

Interestingly, in Robo's post #854 [11/08/07], in his "Cave Bear Talk," he said: "just heard on Bloomberg that Paulson is getting ready to talk about China.][You can bet some deals were made the last few days with the Chinese."] Now, Robo doesn't seem to think much of Paulson, but who knows, maybe...
VR
 
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Stocks Dive Over 2% At Opening On Yen's Sharp Rise
sp.gif

TOKYO (Kyodo)--Tokyo stocks plunged at the opening Monday, sending the benchmark Nikkei index to its lowest level in 15 months on the yen's sharp appreciation against other major currencies.
http://www.nni.nikkei.co.jp/

NIKKEI 300
http://www.marketwatch.com/quotes/jp/1885002?sid=125497

YEN FOREX
http://www.advfn.com/p.php?pid=forexconverter&curcode1=USD&curcode2=JPY&cb=1194834516

Advin TSX
http://www.advfn.com/p.php?pid=countrysum&cid=15&cb=1194834619
 
You're right, there sure was HEAVY buying and Friday broad based selling right at the end of the day. I really don't know who these buyers and sellers were but I suppose they had a good reason to put that much money into the financials right at the end of the day. What could be their reasoning? I can't see where the situation changed that much at the end of the day, only that they started BUYING or SELLING huge amounts of stock. It happens all the time. I think it's about making money, simple as that!:cool:

Is it possible for us to make long term decisions based on the actions of short term traders? These people rarely hold positions over night - even in bull markets.
 
Is it possible for us to make long term decisions based on the actions of short term traders? These people rarely hold positions over night - even in bull markets.
I really have to say, probably not, but some of them do come up with what I consider pretty good perspective on the long term market in order to predict the short term. WHAT, did I say? As you know I or shall I say we are not long term investors by definition.:cool:
One of you numbers guys should try tracking this kind of action and see if there are trackable trends, I think there is. We all know the profit takers usually come in around 14:15 to 14:30 EST and have seen the tremendous rallies or dips in the last 30 minutes of the day. Is there a pattern that can tell us something about the condition of the Markets? HHUUUUmmmmmm?:suspicious:
 
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