In a speech in South Carolina today, Federal Reserve Chairman Ben Bernanke gave another subdued forecast for the economy. He said that while “the financial crisis appears mostly behind us…we still have a considerable way to go to achieve a full recovery in our economy” due to persistent unemployment, foreclosure and lost savings for many Americans.
As the dollar continues its massive losing streak, the last place you would expect to see it is in the “best” column on any “best/worst” style list. But that’s exactly where it falls on Casey Research’s new report on the economy, “The Good, Bad, and Ugly: Year-End 2009.” Casey Research lists the U.S. dollar under “The Good” column because the dollar is the reserve currency of banks around the world. (more…)
Cause and effect is always a tricky concept and that is most true when it comes to markets. With only two directions to go any explanation can seem valid. So when the Dow Jones Industrial Average dropped nearly 400 points on Friday there where many explanations out there.
The sharp increase in the unemployment rate, to 5.5% from 5% — when most expectations called for a minor increase to 5.1% — was obviously what got the bears rolling and the consensus is that the sharp increase in crude oil is what kept up the selling pressure.
I would suggest that Comments from European Central Bank (ECB) President Jean-Claude Trichet, suggesting that the ECB could soon raise interest rates to address rising inflation is what triggered dollar weakness and consequently the oil rally but it has already been determined that evil speculators are the only cause of higher oil prices. Isn’t it nice for “big Oil” and Opec that there is a new scapegoat on the block to point at.
