What's going on with the Euro?

[SUBMAN1]

Euro Falls the Most in 8 Years on Reduced Bets for Higher Rate

Maybe some Europeans can answer this question?

http://www.bloomberg.com/apps/news?p...efer=worldwide

-S

[UnderseaLcpl]

I would also like a European answer.


However, I can give you an American answer right now. The dollar will be bouncing back for a bit, meaning that currency speculators are diverting investments back to the dollar. This is largely due to slipping oil prices. Even though U.S. domestic drilling hasn't really produced much yet, it threatens to lower the price of oil (here). In turn, this means that investors of all types have more confidence in the U.S. economy and U.S. Buisness. They simply seek to take advantage of the fact that the U.S. recession may be coming to and end. For a while.

Here's an experiment in consumer and investor confidence. When the 08' presidential election rolls around, watch what happens if McCain is elected. Now, I'm no McCain fan, but I can guarantee that it will lead to a temporary surge of investment, and therefore, stock and dollar growth.
If Obama wins, which he won't, it may well drop us into another low spot. The dollar will drop again as well.

More important are Congressional elections. If it looks like the dems are going to win it, the stock suffers a little, as wary investors pull out in fear of liberal economic policy. If republicans seem to be gaining control, it gains a bit.
This difference will become less and less pronounced as mainstream conservativism shifts it platform to the left.

Of course, there are many other influences, like the outcome of the holiday season's marketing, and the effect winter has on fuel prices.

This is a brief and horribly oversimplified take on the situation, but it covers the basics.

[Type941]

there are fears that EU economy is gonna slow quite much in 2H08, with the growing inflation rate and ECB keeping rates unchanged again (and high), plus US economy being resilient to recession, seemingly the faith is back with the dollar now again (for now) and it's also the reason why dollar traded oil is taking a dive.

I always expected dollar to recover - and I think if US elections go as planned and Obama wins, it will grow even more. Time to buy some call options on US stocks, hehe.

[SUBMAN1]

Originally Posted by Type941

there are fears that EU economy is gonna slow quite much in 2H08, with the growing inflation rate and ECB keeping rates unchanged again (and high), plus US economy being resilient to recession, seemingly the faith is back with the dollar now again (for now) and it's also the reason why dollar traded oil is taking a dive.

I always expected dollar to recover - and I think if US elections go as planned and Obama wins, it will grow even more. Time to buy some call options on US stocks, hehe.

Actually I expect it to decline with Obama in office. Listen to their speeches. They have no intention of turning the ship around. They all walked out of Congress last week too when the issue was being discussed. Left the repubs debating and turned the lights out on them and even turned the mic off on them because they were late for dinner or something. I hate to differ with ya, but I can't see that happening. I'd have to agree with the post prior to yours.

-S

[Stealth Hunter]

It's just the American economy going down the tubes. The whole world is slowing down because of it.

[SUBMAN1]

Originally Posted by Stealth Hunter

It's just the American economy going down the tubes. The whole world is slowing down because of it.

Quite the contrary. That is why people are investing in the dollar is because we are not going down the tubes!

I'm however confident that someone will try to spin it this way in the media. It is always Americas fault somehow.

-S

[Type941]

Originally Posted by SUBMAN1

Actually I expect it to decline with Obama in office. Listen to their speeches. They have no intention of turning the ship around. They all walked out of Congress last week too when the issue was being discussed. Left the repubs debating and turned the lights out on them and even turned the mic off on them because they were late for dinner or something. I hate to differ with ya, but I can't see that happening. I'd have to agree with the post prior to yours.

-S

well, that'st the thing, it's a 5050 on this opinion in US... but in europe, McCain has no chance. Just on SENTIMENT alone Obama taking office will spark quite lots of opimism in Europe and China probably too, since he is not that much of a hawk. Not at all actually. AND - since Europe and China finance US debt - it's all that matters.

Whether Obama fiscal policy will be good or bad i don't know - I think US functions quite well without even president if needed, so the fiscal policies will continue..

What you guys see now is a fiscal policy and political will that's willing to intefere in market economy. Whethere that's good or bad is hard to say. On one hand it's bad - as it defeats the whole puprose of marketBut on the other hand, let Fannie Mae and Freddi Mac collaps, let Bear Sterns default on all its debts to Morgan, and so on, the whole Stock Market will collapse in the US - and US economy as a result. Fact is you guys have all the pensions there, everything - and FEDs main resposibility is to prevent that from falling. If it happens, the credit crunch will be nothing compared to what that will bring. believe you me.

Anyway, I think McCain hasn't got a clue about economics, and he is too old to make sense. So if now you have president that decides on key issues according to what God told him, in McCain you will have another one who will listen to doctors and voices in his head. Obama is at least healthy sane normal person. He is no saint I'm sure, in fact I'm confident the guy can be brutal in politcis but they all are, it's what's needed to succeed.

[STEED]

What's going on with the Euro?

Best thing for it, throw some more Euros on the fire I'm feeling a chill.

[Kapitan_Phillips]

Damn right, STEED.

[Stealth Hunter]

Originally Posted by SUBMAN1

Quite the contrary. That is why people are investing in the dollar is because we are not going down the tubes!

I'm however confident that someone will try to spin it this way in the media. It is always Americas fault somehow.

-S

But as the dollar becomes more and more worthless, your Euro is going to suffer.

However, all this investing IS gradually causing the value of the dollar to increase ever so slightly, although economies the world over are suffering from it.

[SUBMAN1]

Originally Posted by Type941

well, that'st the thing, it's a 5050 on this opinion in US...

Whether Obama fiscal policy will be good or bad i don't know...

This is the problem - You have no idea - No history. Maybe the other 50 are just betting people who hope they will hit the jackpot? Well, I hate to tell you but not only do you not know, there is some strong evidence on that you will lose all the chips and that evidence comes from your current Congress. They could care less about the economy or gas prices or anything. All they care about is whats for dinner. We are doomed if this continues, so yeah, Europe should have a major problem with Obama getting in office.

-S

[UnderseaLcpl]

Originally Posted by SUBMAN1

This is the problem - You have no idea - No history. Maybe the other 50 are just betting people who hope they will hit the jackpot? Well, I hate to tell you but not only do you not know, there is some strong evidence on that you will lose all the chips and that evidence comes from your current Congress. They could care less about the economy or gas prices or anything. All they care about is whats for dinner. We are doomed if this continues, so yeah, Europe should have a major problem with Obama getting in office.

-S

That was a little brusque, but I have to sort of agree with subman on this. Historically speaking, democrats are not good for the economy. And someone please cite Clinton as a counterpoint. I would enjoy that

[SUBMAN1]

Originally Posted by UnderseaLcpl

That was a little brusque, but I have to sort of agree with subman on this. Historically speaking, democrats are not good for the economy. And someone please cite Clinton as a counterpoint. I would enjoy that

That would be entertaining! Clinton's best unemployment rate was GWB's worst! But of course, the American economy is going down the tubes even though our Unemployment #'s are better still than at any point in time during Clinton's admin!

Do you think i came across harsh? Must analyze my post above. I have been known to be rather blunt at times.

-S

[Type941]

http://www.ft.com/cms/s/0/8cc0b4e0-6...nclick_check=1

good article.