"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat

Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput


Wednesday, February 23, 2011

Broad Dollar Index coming under Increasing pressure

The Broad Dollar Index is comprised of a much larger or broad basket of currencies than the USDX which we more commonly reference. In this regards, it is a better representation of the how the Dollar is faring on the world currency markets. Notice how weak it has become and how close it is to challenging a key downside support level.

The inability of the US government to come to grips with its fiscal problems combined with the Fed's asinine Quantitative Easing policies are crushing the Dollar.

1 comment:

  1. Dan, Many thanks for posting this timely update. I checked out the broad index and it contains 26 currencies rather than the 6 in the USDX


    I do not place much credence in the USDX any more because it is heavily overweighted to the EUR (57.6%) In my opinion the EUR is no longer to be trusted after Trichet accomodated the politicians (this is a very polite verb)and started printing money to buy Greek bonds in May 2010. He is still buying Portugese and Irish bonds at a rate of knots. This sort of nonsense is what the German Bundesbank was forbidden to do by law when the D-Mark still existed.


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