Friday, October 21, 2016

Remember how I've been saying the dollar would get stronger not weaker?

The dollar is the highest it's been since February of this year at 98.64. This means pressure will resume on oil, commodities, exporters and emerging markets. Here. It's about 2-2/5 cents below the high set in Jan when the FeD was insisting they were going to raise rates. When they didn't - it started a downward trend. I think they will raise in December because..... no fucks given then.

It's been a little tense trying to figure out how much stronger it would go. I thought it was possible it was tapped out. But world events keep making it go higher. However, as I said not too long ago - around the year 2000, the dollar was way up into the 120.00 range. Here. I think it could potentially go that high. And that would put immense deflationary pressure on everything. We've been rolling in a 7 cent range the whole year. If the dollar were to go up more than 20 cents - that is a really huge move.

Just to give you an idea -  the dollar went up about 20 cents from summer-ish 2014 to the end of 2015 you saw what happened to oil, commodities and earnings.

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