As the Dow Jones approaches, the 6000’s, I cannot help but think of one of the great lies behind this financial mess that was sold to the general public. The fact that most so called personal finance experts have told people that “they have to be perfect when they time the market!” Therefore they shouldn’t even think about it and even thinking about would be a living a hell!
This past year, one of the few financial instruments in the world was headed to the moon. Which one was that? The yen!
Yeah, the carry trade unwound which caused money to flow away from high yielding currencies and back into low yielding currencies like the yen.
Investors became risk adverse with their money. They poured it into things that had been beaten down for years because it seemed to be a safe place to run to. Thus the yen was a huge beneficiary during this ultimate “fear factor”.
However, recently I started talking to you about a possible turn coming in the yen and that the yen party was about to come to an end soon.
With another “mini” ponzi scheme popping up in the news lately and all the talk about steroids, I could not help but notice the similarities between the two. Two great American past times, Wall Street and Baseball have been pumped up for too long and are now bursting before our very eyes.
Lately, I’ve been asked a lot about where I see the U.S. dollar going in 2009. So let address this for a moment.
Specifically, I think the dollar will gain against the Japanese yen (USD/JPY pair will rise) throughout 2009.
While formerly, the yen and dollar rose as the Dow crashed, you will notice that the yen is backing off quite a bit even as the Dow sits on its lows as of this writing. Yet the dollar still rises as the Dow falls.
See the chart below.
Yen rally plays out but the dollar strengthens even still!
Missing just one or two deductions can cost you a couple of hundred bucks in some cases, and even people that are pretty well organized, and know the tax system pretty well still miss a couple of deductions every year.
If you want to see recent volatility in action, then you need to look no further than the euro (EUR/USD spot FX currency pair). This thing has been all over the map lately.
Check out the chart below.
Welcome to the euro rollercoaster!
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I was at the computer store Saturday and couldn’t help but notice how many people there were purchasing tax preparation software programs. It is usually good to wait until about now (Mid-February) to do you return because you should have gotten all your W-2’s, 1099’s etc… and therefore not have to worry about receiving one after you have already completed the return.
Back in early January, I wrote an article that focused on a bubble forming in the Treasury bond market. Back then I saw money getting ready to jump from one seemingly safe asset to another…gold. (I wrote about this on January 2nd. I’ll include the links to all of these stories at the bottom so you can check it out for yourself.)
This was my first “tip off” that money was about to start flowing elsewhere and gold was the next logical choice since it has held up fairly well in this bear market downdraft.
Tax Season is in full swing! I want it make certain that you get every deduction you are entitled to this tax season. I also want to cover some of the basic deductions to make certain that none of them are slipping between the cracks. I also want to try to connect the dots with the current economy and your tax return! This will make the tax preparing experience a more interesting one, and you better investor to boot!
Geithner reenacts Jim Carrey’s Fun with Dick & Jane!
Traders and investors alike have been waiting for Geithner’s speech. It got delayed once, so investors just knew that when he stepped up to the mic that he’d really have something to say.
However, what he ended up doing was opening up more questions than answers. The market promptly showed him what it thought about it too. It reminded me of the movie “Fun with Dick and Jane” where Jim Carrey gets on T.V. to talk about Globodyne’s stock as he watches the stock chart plummet from $100 a share to a penny while he’s on T.V.
