Sorting Out the Tax Cut and Unemployment Benefits Extensions

When I turned on the currency screens this morning, I saw that the euphoria of a currency rally, which we had talked about yesterday, had dissipated. I said to myself that it’s a case of “another day, another currency directionâ€�… It all began mid-day yesterday, with gold and silver once again leading the way…only this time the way was down! UGH! Gold was down $24 as I left for the day… It’s down another $5 this morning…

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The Futility of Tax Cuts Without Spending Cuts

Well… The dollar rally that was going on yesterday morning didn’t have the legs to carry on, and by mid-afternoon we were watching the currencies rebound… I truly feel that this time the currencies were led to higher ground by gold and silver!

The rallies in gold and silver yesterday were the things that legends are made of… Silver hit a 20-year high, and gold raced past its previous high water mark of $1,414.07 set on Friday… And the shiny metal is back at it again this morning, setting yet another record level of $1,426.30…

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Markets React to Disappointing Jobs Data

Well… The cold fell over the dollar on Friday, as we saw something that has happened very often in the past two years, and that is a downright – no two-ways about it – convention reaction to the jobs data! First of all, the Jobs Jamboree turned sour when it was learned that US corporations only added 39,000 jobs in November… You may recall that on Friday morning, I told you that the number would be less than the forecast of 150,000 jobs created, but even my guess was higher than the actual, 39,000 jobs created.

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Divided FOMC Lowers Growth Forecasts

The dollar bulls really are having their way with the currencies, which is so weird given the fact that just two weeks ago, the negativity toward the dollar was running at a level I had not seen before… And then it turned on a dime… Here’s the skinny on this as I see it…

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Geithner Advocates a Weak Dollar Policy

The currencies and precious metals have been changing positions versus the dollar for the last three trading days. A week ago, we were looking at levels not seen in some currencies, ever…and for others not seen in over two years! I told you a week ago that I somewhat expected this to happen, as the currencies and metals had moved too far too fast, and needed to consolidate. This is what we’ve seen so far the last three days… And, also, like I’ve told you… I don’t expect this dollar strength to last too long, for the dollar has no yield to attract too many investors.

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Commodity Currencies Punch a Hole in Risk Aversion Fog

Well… I love it when a plan comes together! I told you months ago, that the markets had given up on a rate hike from the Bank of Canada (BOC) at their 9/8 meeting… I took a different road, and said they would still hike rates… I was alone on this one folks, but… Guess what? The BOC hiked rates 25 BPS (1/4%) yesterday! I had thought they BOC would hike rates but attempt to water the hike down with dovish tones… Here’s the BOC statement, you decide if they sound dovish or not…

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How Will Census Workers Affect the Jobs Report?

It was a ping-pong day for the currencies, back and forth over the net… The net being the “level of the dayâ€�… For instance, the Aussie dollar (AUD) played over the 91-cent net all day, and the euro played over the 1.2820 level all day.

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Aussie GDP Prints Strong

Front and center this morning, Australia printed a moon-shot second quarter GDP report, that has the risk aversion campers running for cover this morning. All currencies, except the risk aversion currencies of dollar, yen (JPY) and francs (CHF), are getting sold, and the Aussie dollar (AUD) has gained 1 1/2-cents!

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Existing Home Sales Plunge!

An awful Existing Home Sales report yesterday is causing more people to jump on my bandwagon… You know, the one about the double dip recession, which will be fueled by another housing slump… Of course I call it a double dip, but in reality, I truly believe it to be a “single scoop,â€� for I don’t believe like our government officials, and Fed Heads that we “came out of the recession.â€�… But that’s just me, thinking logically, as always!

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Is the Weak Euro the Reason Germany is Recovering?

Things didn’t get any better for the currencies yesterday (save yen (JPY) and francs (CHF)), as the focus, whether it belongs there or not, remains fixated on the GIIPS once again, and their ability to function under the weight of debt they’ve created for themselves. For those of you new to class, GIIPS is short for the countries of the Eurozone that consist of: Greece, Italy, Ireland, Portugal, and Spain…

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