The problem with the markets these days is that there is too much information floating around that is not essential, yet holds great weight on their performance. Such information can come from various governmental sources such as a senior administration official or a Central Bank board member. The information can be more optimistic rhetoric than actual fact, and can move investor sentiment in the direction that best suits “their” needs at the moment. This pattern has so far resulted in the prolonged agony of USD traders in specific who look at the numbers and then hear the rhetoric and do not know what to make of it.
I have said over and again that something is amiss. Yes, there are “green-shoots” to look to, but are they weeds or productive growth? Ask any true professional in the industry right now and they will tell you that the feeling is just not right, something does not add up and there is a dark cloud up ahead. But yet, you won’t hear this in the mainstream media or news outlets because their “sources” are spewing fertilizer over every minuscule sign that comes up.
The issue at hand here goes far beyond trust. Politicians and officials have lied to their constituents long before the modern era and they will continue to do so – it is a necessary evil in a democracy that relies on free and fair elections. Everyone who works in government wants to continue doing so and they want upward mobility. As the saying goes, you can’t please all the people all the time, but in politics you can certainly try.
I am still worried about the Dollar in the near term as well as the long term. The stock market is beginning to slow down and we are entering a period which traditionally has been a down period. I know the commercial real-estate burst is around the corner and I know the pressure from China, Russia and the UN will begin to intensify as the year winds down. There is political and social unrest all around and it makes no sense that the markets can sustain a high level of growth. The key in the near future would be to determine if the USD’s safe haven appeal is waning as equities begin to fall. If this does happen, it will be the clearest sign that no matter what spin people put on minor economic triumphs; all is truly not well in greenback land.
