TPS Posted October 25, 2010 Posted October 25, 2010 I'm starting to think that Bernanke's jawboning about QE2 was a ruse in the so-called "currency war." His threat of QE2 helped push the $ lower, and US exports are one of the bright spots in the economy. If indeed he proceeded on QE2, Japan and China would be forced to undertake even more currency intervention. All this is prelude to the G-20 meeting, and lo and behold, there's an agreement to correct imbalances from all parties--deficit AND surplus. The indication of this (a ruse) would be the FED announcing in the very near future that QE2 will not be necessary. If this is the case, it's time to buy some call options on the S&P.
Magox Posted October 25, 2010 Posted October 25, 2010 I'm starting to think that Bernanke's jawboning about QE2 was a ruse in the so-called "currency war." His threat of QE2 helped push the $ lower, and US exports are one of the bright spots in the economy. If indeed he proceeded on QE2, Japan and China would be forced to undertake even more currency intervention. All this is prelude to the G-20 meeting, and lo and behold, there's an agreement to correct imbalances from all parties--deficit AND surplus. The indication of this (a ruse) would be the FED announcing in the very near future that QE2 will not be necessary. If this is the case, it's time to buy some call options on the S&P. One thing that the FED has been is that it has been transparent, in regards to telegraphing their moves, this is something that he believes in and if you judge him by the body of his actions, then they will proceed with QE2. Also, that "agreement" over the weekend, basically is the equivalence of Geithner or any other recent U.S Treasury secretary saying "We believe in a Strong Dollar". It was just a bunch of empty statements with no hard targets or commitments. The G20 meeting produced nothing of substantive value.
TPS Posted October 25, 2010 Author Posted October 25, 2010 (edited) One thing that the FED has been is that it has been transparent, in regards to telegraphing their moves, this is something that he believes in and if you judge him by the body of his actions, then they will proceed with QE2. Also, that "agreement" over the weekend, basically is the equivalence of Geithner or any other recent U.S Treasury secretary saying "We believe in a Strong Dollar". It was just a bunch of empty statements with no hard targets or commitments. The G20 meeting produced nothing of substantive value. Pure speculation on my part. We'll know in a few weeks. Also too early to write off the publicized agreement--speculation on your part. Edited October 25, 2010 by TPS
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