UUP will rise because the other currencies the dollar is measured against aren't any better. However, this doesn't change the inflation picture and the inevitable loss of reserve status the dollar will suffer.
kill jewboy jewnanke,.,,,,,,DEVALUE THE DOLLAR AND PUMP UP THE MARKETS.........KIL HIM.....COMMODITIES SOARING AGAIN.........i HATE HIM AND PARY SOMEONE BLOWS HIS HEAD OFF.
Ben is running into an issue here, food inflation is ramping up due to the drought, he could easily print with less inflation, but now it will be difficult. He needs to print to slow the FX losses on companies, finance the debt, spur the economy, kick the can... but with inflation it could be difficult.
So... we stay higher until a real QE3 happens.
This dollar rise alone can trigger QE3, Ben wants a weak dollar, but europe isn't cooperating. The strength of the dollar gives Ben all the ammo he needs because he can blame the weak manufacturing sector on our inability to export due to the stronger dollar.
I think we see qe3 before September. I wonder if the debt ceiling can be pushed out to 2013.
But if Greece gets kicked out of the euro and Spain looks as shakey as we know it is, then we can still see the up rise,
But the FED wants a weak dollar, that points to QE3,4,5,6...
QE3 not on the table yet. As long as Europe remains unstable dollar is likely to keep going up. If Greece leaves the Euro zone and defaults on their loans then there will be a bank run across Europe and that money will be buying dollars.
Bernanke has written papers about how when you no other bullets to use that rhetoric will be used. The link is from Faber's Gloomboomdoom report, but he quote bernanke.
read page 9. Read the whole thing, but really read page 9.
communication by the central
bank is always important, it
becomes especially important
when the rates are near zero.
Indeed, when the proximity of the
zero bound prevents further rate
cuts to stimulate the economy,
talking about future policy actions
may be one of the few tools at the
central bank’s disposal by which
to influence conditions in
Just remember, Bernanke is playing us, buy gold on this dip. $1,646.10 as I type this.