Today’s Call: US Dollar Index to fall. Currently 74.61.
Rationale: The Federal Reserve is beginning its policy meeting today surrounded by the news of an economy that is “headed for” (already in) a depression. Anticipation of Greek “progress” via a confidence vote to lift the Euro temporarily. This, along with news that Obama and Boehner are making progress on the US debt ceiling standoff, should shoot the dollar higher. The Fed cannot let this happen and may even recommend more direct stimulus to taxpayers since QE measures have failed to spur consumer confidence. This should weaken the dollar.
Calls to Date: Good Calls: 29, Bad Calls: 25, Batting .537, seriously reverting to the mean!
Key Indicators for Tuesday, June 21, 2011
Gold Price Per Ounce: $1,546 BENEFITING FROM PERMANENT UNCERTAINTY
MINT Perceived Target Rate*: 2.25%
Unemployment Rate: 9.1%
Inflation Rate (CPI): 0.2%
Dow Jones Industrial Average: 12,207
M1 Monetary Base: $1,921,900,000,000 RED ALERT!!!
M2 Monetary Base: $9,084,400,000,000 YIKES!!!
*See FED Perceived Economic Effect Rate Chart at bottom of blog. This rate is the FED Target rate with a 39 month lag, representing the time it takes for the FED Target rate changes to affect the real economy. This is a 39 months head start that the FED member banks have on the rest of us on using the new money that is created.