Roque: "Dramatic Denouement in Store for the Dollar&quo
Enviado: 6/1/2004 19:51Este Roque, às vezes, tem algumas frases geniais como esta: "Moreover, "everyone" believes that "everyone" is negative on the dollar, which suggests that "everyone" is looking for a contrarian rally in the greenback. The real contrarian call, I believe, is to expect the dollar to continue lower. " 
Aqui fica o artigo completo:
"Dramatic Denouement in Store for the Dollar"
By John Roque
Special to RealMoney.com
01/06/2004 11:25 AM EST
"I'm bearish on the dollar and bullish on gold and silver, and I've been that way for some time. But I'm more than a little interested in Fed Governor Ben Bernanke's recently published comments on the dollar.
Bernanke and, by extension, Alan Greenspan and the Federal Reserve are dismissing "crisis" risk in the dollar. I don't know about you, but I get nervous when central bankers tell us not to get nervous. After all, Greenspan served as the Fed chairman during the 1987 "crash," the Asian/Russian/Long Term Capital Management crisis in 1998, the Nasdaq's bubble and subsequent pop in 2000 and most recently the bond market's peak and subsequent crash in June 2003. The Fed is supposed to ameliorate volatility. What do you think would happen if it made a few "important" mistakes?
I don't believe I'm going overboard by saying that Greenspan's record of presiding over four separate market crashes is right up there with a few other records that will never be broken: Joe DiMaggio's 56-game hitting streak, Cy Young's 749 complete games and the number of times Steve "Crocodile Hunter" Irwin has said "Crikey!" in one of his television shows.
If Bernanke, Greenspan and company are saying they're not concerned about a dollar crisis, shouldn't that mean we're already in one? Shouldn't that mean we should have some insurance (like gold) to guard against Greenspan's record outlined above? Doesn't the dollar's action suggest that the slide won't be over until the action becomes disorderly? After all, if the Fed is OK with an orderly decline in the dollar, then meaningful "intervention" won't likely occur until the decline becomes disorderly.
Moreover, "everyone" believes that "everyone" is negative on the dollar, which suggests that "everyone" is looking for a contrarian rally in the greenback. The real contrarian call, I believe, is to expect the dollar to continue lower.
I'm worried about the dollar, and I don't believe for a second that, according to Bernanke, looking at the dollar vs. one currency is wrong. It's not necessarily better to look at the dollar vs. a host of currencies. After all, whichever way you look at the dollar, it's getting smoked. But just to humor Bernanke, here goes:
The Dollar's Descent
Other comparisons aren't heartening, either
Dollar vs. Peak/Bottom & Date Recent Level % Change
Euro 0.82; Oct. 26, 2000 1.2666 -55%
Japanese yen 135.14; Jan. 31, 2002 106.12 -22
Canadian dollar 1.6193; Jan. 21, 2002 1.2826 -21
Australian dollar 0.4775; April 26, 2001 0.7682 -61
British pound 1.3682; June 12, 2001 1.8069 -32
Swiss franc 1.8298; Oct. 26, 2000 1.2344 -67
New Zealand dollar 0.3900; Oct. 18, 2000 0.6709 -72
Dollar Index (Spot) 121.02; July 6, 2001 86.11 -29%
Source: Natexis Bleichroeder
Getting overly concerned about dollar weakness, such as by selling stocks, has thus far been detrimental to performance. Although I'm not a macro guy, I can't help but feel that the final chapter in the book about the dollar's slow and steady descent will be much more dramatic than the story has been thus far. The timing, however, is something I can't predict. "
(in www.realmoney.com)
Aqui fica o artigo completo:
"Dramatic Denouement in Store for the Dollar"
By John Roque
Special to RealMoney.com
01/06/2004 11:25 AM EST
"I'm bearish on the dollar and bullish on gold and silver, and I've been that way for some time. But I'm more than a little interested in Fed Governor Ben Bernanke's recently published comments on the dollar.
Bernanke and, by extension, Alan Greenspan and the Federal Reserve are dismissing "crisis" risk in the dollar. I don't know about you, but I get nervous when central bankers tell us not to get nervous. After all, Greenspan served as the Fed chairman during the 1987 "crash," the Asian/Russian/Long Term Capital Management crisis in 1998, the Nasdaq's bubble and subsequent pop in 2000 and most recently the bond market's peak and subsequent crash in June 2003. The Fed is supposed to ameliorate volatility. What do you think would happen if it made a few "important" mistakes?
I don't believe I'm going overboard by saying that Greenspan's record of presiding over four separate market crashes is right up there with a few other records that will never be broken: Joe DiMaggio's 56-game hitting streak, Cy Young's 749 complete games and the number of times Steve "Crocodile Hunter" Irwin has said "Crikey!" in one of his television shows.
If Bernanke, Greenspan and company are saying they're not concerned about a dollar crisis, shouldn't that mean we're already in one? Shouldn't that mean we should have some insurance (like gold) to guard against Greenspan's record outlined above? Doesn't the dollar's action suggest that the slide won't be over until the action becomes disorderly? After all, if the Fed is OK with an orderly decline in the dollar, then meaningful "intervention" won't likely occur until the decline becomes disorderly.
Moreover, "everyone" believes that "everyone" is negative on the dollar, which suggests that "everyone" is looking for a contrarian rally in the greenback. The real contrarian call, I believe, is to expect the dollar to continue lower.
I'm worried about the dollar, and I don't believe for a second that, according to Bernanke, looking at the dollar vs. one currency is wrong. It's not necessarily better to look at the dollar vs. a host of currencies. After all, whichever way you look at the dollar, it's getting smoked. But just to humor Bernanke, here goes:
The Dollar's Descent
Other comparisons aren't heartening, either
Dollar vs. Peak/Bottom & Date Recent Level % Change
Euro 0.82; Oct. 26, 2000 1.2666 -55%
Japanese yen 135.14; Jan. 31, 2002 106.12 -22
Canadian dollar 1.6193; Jan. 21, 2002 1.2826 -21
Australian dollar 0.4775; April 26, 2001 0.7682 -61
British pound 1.3682; June 12, 2001 1.8069 -32
Swiss franc 1.8298; Oct. 26, 2000 1.2344 -67
New Zealand dollar 0.3900; Oct. 18, 2000 0.6709 -72
Dollar Index (Spot) 121.02; July 6, 2001 86.11 -29%
Source: Natexis Bleichroeder
Getting overly concerned about dollar weakness, such as by selling stocks, has thus far been detrimental to performance. Although I'm not a macro guy, I can't help but feel that the final chapter in the book about the dollar's slow and steady descent will be much more dramatic than the story has been thus far. The timing, however, is something I can't predict. "
(in www.realmoney.com)