The USD index has rallied over 5%, and many short players were clobbered. But what has changed in the U.S. economy to justify this sudden shift? Major banks are still insolvent, we still borrow $2B a day from Asia to fund our deficit spending, and price inflation for consumers is ticking along at 8%-10%. Happy days are here again?
My theory for the odd rally is recent military movements. Two Navy carrier groups are headed to the Persian Gulf to join the two already stationed there (no mention BTW in the mainstream press), and the Soviets -- I mean Russians, are starting to reclaim territory in Georgia (something to do with an oil pipeline). If the SHTF, investors want to be in U.S. dollars.
My theory for the odd rally is recent military movements. Two Navy carrier groups are headed to the Persian Gulf to join the two already stationed there (no mention BTW in the mainstream press), and the Soviets -- I mean Russians, are starting to reclaim territory in Georgia (something to do with an oil pipeline). If the SHTF, investors want to be in U.S. dollars.
Jim McSheehy