Saturday, July 11, 2009

no new stimulus yet...

from yahoo news:

Obama rejects 2nd stimulus: Give recovery time

this 'news' isn't much of a surprise for subscribers of the Trend & Value Letter. here is a excerpt from the June 16, 2009 issue:

The very fact that
everything is ebbing and flowing in an increasingly
similar manner versus the Dollar makes me more
confident that Dollar Enlargement is on the return. In
absence of another pump priming episode – whether
fiscal, or monetary, or both – in the near future, the
general liquidity rally that took shape over the first part
of this year will roll over into another orthodox deflation.
This can be preempted with another round of 'stimulus'
and/or creative monetary policy, but I question whether
officialdom understands the need to strike again, or if
they do understand that whether they have the will or
even the desire to take preemptive action.

I say desire, because I am not sure that 'They' don't want
a secondary deflation now. From a domestic (US)
standpoint the Statist power grab has really just begun,
but each stage of the process requires a new bogeyman.
In order to exert more control over the productive
economy the State now needs another crisis episode as
an excuse.

From a international perspective the US State also stands
to benefit from another contraction. Years ago I forecast
that in the future, historians would refer to this era as
The Dollar Wars. 2001 to 2008 was the first episode of
this drama (melodrama!). Keeping with the metaphor, a
new episode is playing out right now – The Empire
Strikes Back. By the end of this episode it will appear
that the 'Empire', and its Dollar, is more powerful than

and in other pro-Dollar news, the US Trade Deficit continues to narrow:

May trade deficit unexpectedly drops to $26B

WASHINGTON – The U.S. trade deficit fell to the lowest level in more than nine years in May as exports posted a small gain while the weak American economy pushed imports down for a 10th straight month.

The slight rebound in exports, combined with a slower pace of decline in imports, showed that the nosedive in global activity may be starting to ebb. Delayed revivals overseas likely will hinder a rebound in the U.S., but most analysts still expect the American economy to grow a bit later this year.

The Commerce Department said Friday the deficit narrowed to $26 billion, a drop of 9.8 percent from April and the lowest level since November 1999. Economists expected the deficit to widen to $30.2 billion in May.

now when you start seeing headlines such as, 'US Trade Surplus increases less than forecast' let me know and I'll start taking profits on my USD long positions.