While the Fed’s taper talk has been tapered and then un-tapered, the market may now be tapering the Fed rather than vice versa. Let’s assess Act 2 of the taper talk and the implications for the markets, including the dollar and gold.
In the short to medium term, the U.S. dollar and currencies are heavily influenced by the actions of the Fed. As the Fed may be reading tealeaves as much as anyone else, we may be facing particularly high policy uncertainty that, in turn, reflects on elevated volatility in the bond and currency markets. The good news is that this may yield opportunities for the prudent investor.
Gold is up, even getting a positive mention in Barron’s. Is it Japan’s election or the tapering of the taper talk that’s driving gold higher of late? Is this a bounce or the beginning of a new major uptrend in gold?
The “cleanest” dirty shirt, the U.S. dollar, is down versus the euro so far this year; and was down last year. If this is a strong dollar environment, are investors prepared for a weak one? With plenty of dirty laundry in the world, we ponder how investors might be able to profit from actively managing currency risk.
The Fed’s “tapering,” the dollar’s up, bonds are down. Is this time to bet on the greenback, or to diversify out of the dollar? We believe the dollar may not only have gotten ahead of itself, it also rallied for the wrong reasons. We look at the risks and opportunities presented.
Anyone who’s ever had a brick fall on one’s feet knows how much it can hurt. It’s little consolidation if that brick is made of gold. What’s happening to the price of gold? And has our outlook changed, be that for gold, the U.S. dollar or currencies more broadly?
Is it time for the Federal Reserve (Fed) to stop printing money? Today, we focus on what might be going through Fed Chair Bernanke’s mind and the possible implications for the U.S. dollar and investors.
Unsustainable debt. Depression-era fiscal policy. Monetary madness. Welcome to Japan. You may not live or invest in Japan, but your investments may well be affected by what is unfolding in the Land of the Rising Sun. Be prepared.
Had those with money tied up in the Cypriot banking system owned gold instead, they might have been able to watch the unfolding crisis relaxing on the beach. So why isn’t gold going through the roof? Is Cyprus too small to matter? Can it happen in the U.S.? Should investors hold gold?
When we called the euro the potential “rock star of 2013”, we knew it might be a rocky ride. Are we underestimating the incompetence of policy makers? The Europe that is shaping up is much like the old Europe, with implications for the dollar, the euro, and investors’ portfolios.