tag:blogger.com,1999:blog-11027528911364475.post1712530170478607294..comments2024-02-18T21:10:05.205-08:00Comments on EconomPic: Dollar Carry Trade Version 2.0Jakehttp://www.blogger.com/profile/07946497592651234440noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-11027528911364475.post-82602085514514707342008-12-17T18:23:00.000-08:002008-12-17T18:23:00.000-08:00Agree, which is why longer term I am not bearish o...Agree, which is why longer term I am not bearish on the dollar like some. This was likely just a reversal of the dollar rally, which was due to the deleveraging process.Jakehttps://www.blogger.com/profile/07946497592651234440noreply@blogger.comtag:blogger.com,1999:blog-11027528911364475.post-32736219252837184232008-12-17T11:19:00.000-08:002008-12-17T11:19:00.000-08:00I suppose that does make sense. But the market pri...I suppose that does make sense. But the market priced in the Fed's cuts very quickly (before the announcement) and the other inflationary actions are unlikely to spur any real inflation until the velocity of money returns (i.e. lending). In the interim, you have a short-term oversold DXY, and where can the Fed take rates from here? Compare that to the rest of the world, Eurozone, China, etc., who have yet to ratchet rates down much further in spite of lip-service to the contrary. That speaks favorably to the relative USD picture.Anonymousnoreply@blogger.com