Economic Charts

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Saturday, September 18, 2010

Peter Schiff on the Markets

A brief video from Peter Schiff on the markets, where he tackles many angles of the market action this week, including; gold, bonds and policy.

Here is a chart of this weeks action in the dollar index, as Peter refers to in the video.  Each candle represents one week.  We have a little ways to go to hit the lows we saw around November of 09, but we seem to be getting there relatively quickly.  Peter makes the point that the dollar would have lost more, but Japans intervention this week held the dollar up.  For those of you whom don't know what Japan did this week, they did a massive sell off of the Yen to force strength in the dollar and weakness in the Yen.  Why would they do this? Because as their currency gains strength, their exports become more expensive (bad for the Japanese people, but good for exports).  Given the commitment of U.S. policy to weaken the dollar, I don't see the Yen weakness staying that way too long.  If you look at this weeks candle (pretty large already), it makes you wonder how much lower we would have gone.

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