Friday, October 14, 2016

Wow. The dollar is quite strong today.

98.09. Two/three cents from recent highs. (here) We logged almost three cents in the time I was gone. No one knows where the dollar is going. A while back I'd started reading stories about how it was set to collapse because some chart said so.

I've always thought the dollar (could) go much higher. Watching the dollar is the only way I was able to spot the oil collapse. And while the dollar right now is stronger than it's been in 10 years - around the year 2000 the dollar was quite a bit stronger. In the 120.00 range. Here. That;s only 16 years ago,

I think if Trump wins we could get a very strong dollar indeed. Not necessarily because of him - because the rest of the world is really having wild currency fluctuations. That makes our dollar stronger. Then the stronger dollar starts reinforcing a safety trend putting more pressure on the dollar to be yet stronger because more people buy it causing a shortage and making the dollar stronger.

Yellen insisting they are raising rates also tends to make the dollar stronger. It's hard to see how the dollar is going to end up. It's been going sideways most of the year. This has caused earnings to stabilized, as well as oil. But if the dollar starts getting very strong again - deflation pressures will flair up. This will bring down earnings again.

I honestly watch the dollar all the time now. Like every few days. We are all it's bitch. I guess if the stock market crashed that might make the dollar weaker. Outside of that, it looks like this trend continues because the rest of the world is worse off than we are.

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