Well, the economy logged a brisk 3.9 growth rate, which is pretty stellar, particularly since it would have been about 1% higher if the housing market were not tanking, but still, the Fed cuts rates by 25 basis points.
Maybe they know that there is some level of bullsh&% in the figures that they cannot trust.
In response, the dollar tumbled. The Canadian dollar bought more than $1.06 for the first time since 1957, the Euro broke the $1.45 barrier, going to $1.4503:1.0000€, and the Sterling is now $2.0813:£1.0000.
I said that the dollar would break through $1.50:1.00€ before year’s end, and I stand by that.
As to the Chinese Yuan, it doesn’t move as much, as it it still partially pegged to the dollar,
but it has risen by about 10 % since it became more loosely pegged about 27 months ago.
I expect a run on the US dollar sooner, rather than later, perhaps before the 2008 elections.