Dollar vs. Dow
 

I follow the value of the dollar and have seen it decline in the last 8 months, have wondered why. Market has been the inverse.

Article from yesterday's NYT. https://www.nytimes.com/2017/08/01/business/dealbook/dow-22000-stock-markets-dollar-value.html?hp&action=click&pgtype=Homepage&clickSo urce=story-heading&module=first-column-region&region=top-news&WT.nav=top-news

Any thoughts on when and why the Dollar will rebound?

http://forums.pelicanparts.com/uploa...1501695344.jpg

Just wait. Tabs will 'splain it.

It is One Big Confidence Game at our expense.

In only 2-3000 words no less. :D

My guess as to his answer is Fed policy and continuous printing of those 100's......

Probably a yuge oversimplification but, there is a ton of liquidity in the market(s) currently. Too much liquidity = monetary deflation.
A weak dollar is also in the best interest of any company (including those on the DJI) in emerging markets, which is nearly everyone these days, and there are many new markets being targeted/exploited. BRICs are like, so 2015... :D

Pretty much...and he'll be right.

There are a lot of factors at play, but here are the edited highlights. The large US stocks that make up the industrial averages are all multinational complainies that are based in the US so their currency is the US Dollar. When the dollar goes down it makes their products more competitive in the rest of the world. As a result, US-based multinationals are seeing bigger than expected earnings because of the exchange rate. A few months ago the same companies were still growing because they have large exposure to the US market that prices in dollars, but they faced huge headwinds trying to sell into foreign markets with a rising dollar. This quarter brings the trifecta of good US economic demand, growing ROW demand, and a falling US Dollar.

The Dollar is declining because we have low interest rates, we are perceived to be poised for tax and regulatory reform, and the Dollar has had a heyday against the Euro and other foreign currencies simply because those economies were basket cases. Now that they're stronger it's safer to put money in those countries, which lowers demand for the USD. All in all it's a good thing.

I don't think so. The Fed stopped juicing some time back, and historically low interest rates have been raised a bit. Short answer...the foreign economies and curriences are gaining strength....thus the dollar weakens....it's all relative imo.

Yep...didn't read this far before my previous post, but don't agree with the interest rate aspect....rates have been low (zero) for years...they've been increased slightly...it ain't the Fed behind this imo....

Not a bad thing...looking at the big picture.

The FED controls the Over Night lending rate that banks get..The FED would like rates to be a bit higher but are stymied by a weak economy.

Market forces determine Treasuries as buyers bid on Treasuries to purchase. There has been massive inflows of capital into the US essentially since 09 as a flight to quality and safe haven in a sea of global uncertainty. The same has been true of USD strength.

The benchmark rate to watch is the 10 year note which is as I write is 2.23%. The low on the 10 yr was apx 1.47% in 2016 which reflects extreme pessimism in the Global economy. At 2.23% one can not consider it to be optimism.


Trump said the USD was too strong...and after he said that it fell off a cliff.

The real reason is political turmoil in the US along with weak US economic data. So capital is now moving off shore as the US isn't being seen as being as safe as it was. While the EU Central bank is expected to tighten interest rates due to a strengthening economy. EU economic data is the big reason why the USD rallied in 2014 and now that the EU is doing better the tide is going out on the USD.

As far as one can see it is ebb and flow of valuation.