Have you looked at the charts lately? Stock indexes are at a 2 year high, a stark contrast to the US dollar falling from one low to another. This week the USD hit a 15 year low versus the Japanese Yen and an 8 months low versus the Euro. Funny when you look back to analysts predicting parity with the USD for the Euro!
While central bankers exchange artillery rounds by using words such as “US is currency War’s Tomb Maker”, Ben Bernanke, the US federal reserve chairman, is focused on stimulating the sluggish economy. The central bank is ready to ramp up its purchases of Treasury bonds to spark growth.
Before we all get excited about rising commodities and stocks we need to keep in mind that the USD is still the world reserve currency regardless of what your or my opinion is in that matter. Just as the Euro reversed course the USD might suddenly do the same if an event triggers a “flight to safety” which would burn many investors as they all reach for the exit at the same time.
Keep a close eye on the markets!
Further reading on the economy:
On to our weekly blog roundup:
Money Crashers recently launched a new top personal finance blogs list that classifies blogs using ranking factors such as Alexa ranking and Google PageRank amongst others.
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