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Last Tuesday, Brazil, Russia, India, and China–the so-called BRIC nations–met in Yekaterinburg, Russia, for what was supposed to be an anti-American gabfest. The main agenda item for the first formal meeting of the four largest developing economies was the future of the dollar.

The National Bureau of Economic Recession final admits that the US in a recession and it is about time! According to official recession dating agency, the US economy hit a peak in December 2007. According to the WSJ, the peak marks the end of the expansion that began in November 2001 and the beginning [...]

Half a million jobs were lost in the US economy over the past 2 months, driving the unemployment rate to a 14 year high. Even though October non-farm payrolls fell short of our -300k expectation, the 240k drop and the revision from -159k to -284k for the month of September is just as pessimistic. The US labor market is in a recession and the latest numbers confirm that. However equities actually rallied on the bearish report as investors interpreted the data to mean that the Federal Reserve will cut interest rates by 50bp next month. The sell-off in the US dollar against every major currency pair except for the Japanese Yen indicates that it is the rally in equities that is driving currencies. Trading will be interesting in the week ahead with the lack of any major US economic data until Thursday. Retail sales are due for release on Friday and the expectations of a sharp decline in consumer spending could send investors back into the US dollar and Japanese Yen.

For the second day in a row, Federal Reserve Chairman Ben Bernanke and US Treasury Secretary Paulson pleaded to the power players of Washington to pass their request for $700 Billion to implement their Troubled Asset Relief Program (TARP). However if we move the letters around a bit, TARP becomes TRAP and that is [...]

 
Markets have soared late this week on the news that Superman (aka Henry Paulson) will once again fly into the heat of battle and snatch victory from the jaws of sure defeat. According to Paulson, the federal government is busily crafting a taxpayer funded scheme to absorb all of the bad mortgage debt and make [...]

Over the past few days, the markets have shrugged off the government’s bailout of AIG and a flush of liquidity from central banks around the world. No matter what the Federal Reserve or the US Treasury tried to do, they failed to please the markets. However in the last few hours of trading [...]

This weekend, the US government announced that they have seized control of Fannie Mae and Freddie Mac, also known as the Government Sponsored Enterprises (GSEs). The sharp rally in the Asian and European stock markets as well as the move in Dow futures suggest that we will see similar strength in US stocks. [...]

In the 1980’s, the Ford Motor Company used the slogan “Quality is Job #1”. This was helpful in their campaign to compete with their Japanese counterparts who were perceived to have higher quality automobiles. It would seem, based on recent trends in the employment market that government is now Job #1. This morning’s employment situation [...]

On Friday, we are expecting the number one most market moving release for the US dollar - August Non-farm payrolls. Based upon the leading indicators for NFP, there is a decent chance that job losses could have topped 100k last month.
I wrote this special report for GFT. You can catch my [...]

ECB President Trichet’s lack of commitment towards future monetary policy has led to little volatility in the Euro. After leaving interest rates unchanged at 4.25 percent, Trichet explicitly said that he has “no bias.”
However based upon the number of times he used the words “price stability in his Introductory [...]