The U.S. Dollar Remains Well-Supported Despite A Month of Wild Swings

When the stock market sell-off began in earnest in late February, the U.S. dollar index (DXY) surprisingly plunged along with the major indices. I accepted the narrative explaining that the dollar’s decline came from the euro’s gain as “risk-off” traders rushed to close out euro shorts in carry trades. The swiftness of the risk-off move … Read more

Above the 40 (January 4, 2019) – The Oversold Chronicles End As A Fed-Inspired Stock Market Explodes Higher

AT40 = 20.4% of stocks are trading above their respective 40-day moving averages (DMAs) (ended 13 days in oversold territory)AT200 = 14.9% of stocks are trading above their respective 200DMAsVIX = 21.4Short-term Trading Call: bullish (with caveats all over again) Commentary All oversold periods must end – it is just a matter of how and … Read more

Demographics and Labor Flows Drive the Implications of the Labor Participation Rate

(This is an excerpt from an article I originally published on Seeking Alpha on September 22, 2013. Click here to read the entire piece.) In his opening statement for his press conference following the latest meeting of the Federal Reserve, Chairman Ben Bernanke once again called out the influence of lower participation rates on unemployment… … Read more

The Rush for Gold Intensifies

Gold is suddenly just about the only asset that is working in financial markets. This fact will likely ignite a positive feedback loop that will send gold parabolic in a matter of time. In “India Gold Imports May Reach a Record“, Bloomberg provides some great statistics from various sources that seem to add weight to … Read more

Can the Dollar Rally On A “Cautious QE” and Strong Denials of A Dollar Devaluation Strategy?

Since peaking in June, the dollar has arguably experienced a near freefall. These moves reflect the near certainty felt amongst investors and traders about the Federal Reserve’s intention to print more currency to forestall the threat of deflation. However, with dollar shorts at their highest levels in three years and the dollar index stalling at … Read more

Gold Is Bernanke’s Conundrum

In December, 2009, Federal Reserve Chairman Ben Bernanke insisted that gold’s surge was not signaling increased inflation expectations because it was simply following along with the general rise in commodities. Now that gold stands head and shoulders above the commodity pack, Bernanke is expressing his bewilderment at gold’s strength. Gold is still not a signal … Read more

Bernanke Absolves Monetary Policy During the Housing Bubble

(repost from January 4, 2010) Yesterday, Federal Reserve Chairman Ben Bernanke spoke at the annual meeting of the American Economic Association in Atlanta, Georgia. In his speech titled “Monetary Policy and the Housing Bubble,” Bernanke presented statistical (econometric) analyses to demonstrate that monetary policy contributed very little to the recent housing bubble in the U.S. … Read more

Bernanke On Gold: Higher Prices Reflect Commodity Fundamentals, Not Higher Inflation Expectations

During recent re-confirmation hearings for Federal Reserve Chairman Ben Bernanke, U.S. Senator Jim Bunning – a frequent critic of the Federal Reserve – asked Bernanke several questions about gold prices. Bunning’s questions appear targeted at prodding Bernanke into acknowledging that inflation expectations are much higher than the Federal Reserve’s current estimation. Bunning also uses high … Read more

Officials Continue to TALK Up A Strong Dollar As the WEAK Dollar Continues to Hurt U.S. Trade Partners

Probably one of the longest running jokes in the financial markets is the amount of time U.S. officials spend talking about their support for a strong dollar while taking no action to actually support a stronger currency. On Monday, Federal Reserve Chairman Ben Bernanke made a rare contribution to the bluster by stating his own … Read more