Hurricane Laura is coming . It's a good excuse to get Oil ( /CL ) back to $43.50 but it makes a nice short there as nothing else is going on in the energy market to prop it up. We do have a holiday weekend approaching (next Friday) but driving is mostly off the table this year and, for oil, I'm a lot more concerned with the Dollar bouncing back from it's -10% position and kicking oil's ass after Powell's speech tomorrow at the Jackson Hole conference. While the Dollar deserves to be weak, it's weak relative to what? All the other countries are printing money too – maybe not as fast as we are but the US Dollar is 60% of all the World's currency so, if we are debasing it, we'd have to debase it twice as hard as the Euro (30%) to fall as fast. Europe has indeed spent about half of what we've spent on stimulus but they've spent it much more effictively and seem to be getting their virus under control. Japan has spent the most, by far and the Yen is another major currency the Dollar is measured against so why should the Yen be higher against the Dollar? It makes no sense, so the Dollar is probably too weak now and a move back up in the Dollar to 96 will likely knock commodities and stocks down about 5%. IN PROGRESS
Hurricane Laura is coming.
It's a good excuse to get Oil (/CL) back to $43.50 but it makes a nice short there as nothing else is going on in the energy market to prop it up. We do have a holiday weekend approaching (next Friday) but driving is mostly off the table this year and, for oil, I'm a lot more concerned with the Dollar bouncing back from it's -10% position and kicking oil's ass after Powell's speech tomorrow at the Jackson Hole conference.
While the Dollar deserves to be weak, it's weak relative to what? All the other countries are printing money too – maybe not as fast as we are but the US Dollar is 60% of all the World's currency so, if we are debasing it, we'd have to debase it twice as hard as the Euro (30%) to fall as fast.
Europe has indeed spent about half of what we've spent on stimulus but they've spent it much more effictively and seem to be getting their virus under control. Japan has spent the most, by far and the Yen is another major currency the Dollar is measured against so why should the Yen be higher against the Dollar? It makes no sense, so the Dollar is probably too weak now and a move back up in the Dollar to 96 will likely knock commodities and stocks down about 5%.
IN PROGRESS
