Dollar Falls Vs Euro, Yen On China Reserves Report
Monday, October 26, 2009. TOKYO (MarketWatch) — The dollar fell against the euro and the yen in Asia on Monday after an official newspaper of the Chinese central bank said China should cut its U.S. dollar holdings, adding to concerns over the unit’s global reserve currency status.
The dollar could weaken further later in the day, particularly against the risk-sensitive euro, which is also benefiting from stronger share markets, dealers said.
During morning trade in Tokyo, the People’s Bank of China-affiliated Financial News reported that China should shift more foreign reserves away from the dollar and into the euro and yen.
The report encouraged Asian hedge funds and other short-term players to sell the U.S. currency for its European and Japanese rivals, dealers said. That sent the euro briefly to $1.5064, refreshing its highest level since Aug. 11, 2008.
But the greenback may hold in a Y91.50 – Y92.50 band for the rest of the day, Societe Generale’s Saito said. Any continued rises in U.S. long-term interest rates, ahead of $123 billion in U.S. government debt offerings this week, should support the unit in the coming days, dealers said.
Related Posts
- Dollar’s fall last week is exactly what I’ve been warning about! (12/14/08)
- UN and PBOC Call For Dollar To Be Replaced By Single World Currency (03/26/09)
- Dollar Begins Decline (03/19/09)
- Japan Ready for Round 4 (02/16/09)
- China, Brazil reported planning currency trade deal (06/30/09)
{ 24 comments… read them below or add one }
Hi Larry,
I am a new kid on the investment block. Can you recommend a discount broker or two?
Will your investment alerts include Agriculture?
It looks like you mostly recommend individual stocks, Historically, how often have your recommended ETF, Spiders … What percentage of your ongoing recommendations do you anticipate to be ETFs etc. as over against stocks?
Thanks,
Mark
Larry Edelson Reply:
November 17th, 2009 at 3:09 pm
I like Schwab as a discount broker. Yes, I am watching agriculture very closely. The composition of ETFs versus stocks in my recommended portfolio will vary, based on a host of factors.
Larry, in your September Real Wealth Report, you showed a gold chart titled, “Gold, Monthly Cyclic Data, Data based from 1792 on.” The cycle curve moves down to a May 2010 bottom, but you have been saying that gold is taking off especially as the dollar weakens. You later stated that technical analysis points to higher prices. Can you explain this divergence? Are shorter length gold cycles in play here that takes out the May 2010 bottom?
Larry Edelson Reply:
November 17th, 2009 at 3:11 pm
They are shaping up for a rally now, followed by a decline into the spring of 2010, then another BIG rally going into 2011 and 2012.
Stopped out of Kinross. Where do we put the money?
Larry Edelson Reply:
November 17th, 2009 at 3:11 pm
Wait for my signals!
We are the subscribers of your real wealth report, however there were some information that we would like to seek from you.
1. Kindly tell us the technical levels to watch in the dollar index and the scenarios that you believe would pan out during the course of next two to three months. How much the dollar index would rise to if the bounce back comes in?
2. Also that we deal in the Indian equity markets and so we would like you to tell us if possible the technical levels and forecast of the NIFTY index or SENSEX in the Indian stock markets.
3. It would be great if you could add a little bit in detail about the Indian markets.
Larry Edelson Reply:
November 17th, 2009 at 3:14 pm
In the DX, watch the record lows at the 72 level. If it holds that, I don’t think a rally an get much higher than 80, before turning back down. I’ll address the Indian markets in an upcoming Real Wealth Report issue.
Larry -you called the turn around in the market in March at the bottom. You also said that it would rally to around 10,000 by the fall, most likely October before there would be a correction and another down turn. Well…….its October and the market has steadily fallen over the last couple of days……Is this the correction you were refering to. Would love to see any comments you might have on that.
Larry Edelson Reply:
November 17th, 2009 at 3:16 pm
Yes, most likely. Market remains firm going into January and February of next year.
Larry,
I have recently started seeing articles that the market rally has started losing its breathe and is showing signs of correction. You are one of the early predictor of the beginning of this current stock market rally in March. So, I wanted to get your thoughts on this. Do you think the market is getting into the correction mode? If not, what would be your prediction for the short to intermediate term outlook. Appreciate your inputs.
Larry Edelson Reply:
November 17th, 2009 at 3:17 pm
Any correction should be short-lived and shallow.
Dear Larry,
I am a new subscriber of Real Wealth Report and think you guys are fantastic. My main activity until now is Forex trading and related programs, however, I would like to start buying gold but the price being so high I hesitate again and again…waiting for that perfect day to buy the yellow metal!
Sean writes “I recommend you wait for a dip and then buy”, which is what I am intending to do, but my question and I suspect one that many readers have is this:
With today’s price at $1,196, when and what is considered a dip in the present gold market and time to get in? $ 1,100 an oz? 1,000 an oz?
Can this question be somehow addressed please ASAP?
Thanks Larry!
Peter
Larry Edelson Reply:
December 8th, 2009 at 2:21 pm
Thanks for the kudos Peter, and sorry for the delay responding. I presume you’re buying for the longer term. If so, trying to pick a level should not matter that much. In any event, any pullback should be seen as an opportunity to buy. Especially the pullback that’s occurring right now!
Hi, Larry. Since my last two posts are STILL awaiting moderation (I bet that’s because you’re out of the country), instead of directing you to the Million Dollar Contrarian Portfolio blog, I’ll give you the following links to a couple of articles on the subject about which the blogger was writing (ie. I’ve eliminated the middle man).
http://www.prisonplanet.com/the-rumor-about-london-good-delivery-gold-bars-that-are-allegedly-filled-with-tungsten.html AND http://www.kitco.com/ind/willie/nov182009.html#top.
I know that you’re only indirectly associated w/Weiss Research now. My reason for posting this query to you is that you write a lot about gold and I respect your opinions and recommendations. Hope it’s not an imposition, but I know it’s stuff you would want to know if you don’t already. I’d love to have your impressions.
Many thanks,
Debra
Larry Edelson Reply:
December 8th, 2009 at 2:22 pm
I’m aware of the rumors above, and I personally do not know anyone who’s had a problem. Still, as with anything – buyer beware. When buying gold, only buy from very reputable dealers.
Do you attribute any credibility to the contentions of Ted Butler in his articles on the Investment Rarities website entitled “The Biggest Factor in the Future Price of Silver” and “Industrial Panic for Silver” that a massive naked short position exists held by JP Morgan, inherited from Bear Sterns, which must be resolved at some point which will result in a rise in the price of silver perhaps twenty fold?
If so, is it possible to predict just when this might occur? In other words, how much time do we have to gather a hoard of silver in anticipation of this parabolic rise in silver’s price?
Thank you in advance for your consideration of these questions.
Larry Edelson Reply:
December 8th, 2009 at 2:25 pm
No, I do not agree with him, not one bit at all. And I would not be hoarding silver. Only gold. There are numerous reasons, but the main one is that there is NO shortage of silver. Period. If there were, silver would have already made new record highs, like gold. Yet, silver remains more than 75% below its 1980 high.
In your recent online event outlining the BIG predictions for 2010 you didn’t mention the “Perfect Storm” previously discussed with the foundation for the study of cycles. You had previously stated that there would be a stock market crash in April of 2010. Why wasn’t that mentioned in your recent event?
Also, if the dollar is crashing and has been for several years, how come it appears that real estate and most goods I purchase are actually down in price?
Thanks and keep up the great work.
Larry Edelson Reply:
December 8th, 2009 at 2:26 pm
There may yet be a big swoon mid-2010. But we’re not close enough to that time frame to issue any signals. As to real estate and other goods, keep in mind deflation and inflation co-exist. Some sectors and asset prices go down, while others go up. It is never just one or the other, deflation or inflation.
Hi Larry,
I’m new to your Real Wealth Report and and this BLOG. I’m having trouble following stops. What is your current stop for GLD? Also would it be possible to list all stops and prices when stop was set in the Portfolio At A Glance section? TKS Steve
Larry Edelson Reply:
December 8th, 2009 at 2:27 pm
I do not recommend stops on core long-term holdings. That’s why you don’t see any for those positions.
Thank you for taking time to respond personally to all the comments. Very few advisors will do that, and that makes you special. You are appreciated.
Larry Edelson Reply:
December 8th, 2009 at 2:30 pm
And thank you!
Hi Larry,
I’m a RWT subscriber. I’ve followed you (and the Weiss crew) for the past year or so, and I’ve found you to have the most insightful commentary on why what is happening is happening.
Your larger premise is that the dollar is going to continue to erode away due to the Fed’s actions. How do you think possible sovereign debt defaults might affect this trend short/medium term seeing as how the dollar, at least for now, is still viewed as a “safe haven” investment?
Thanks for all you do. Have a great Christmas!
Larry Edelson Reply:
December 21st, 2009 at 10:57 am
Foreign sovereign debt defaults will boost the dollar short term. But that’s all, just a short-term boost. The biggest default of all will be right here, in Washington.
Larry, I’m doing very well with the gold recommendations you gave. Many thanks.
Question: I’ve seen or read a couple of times where the Fed has supposedly given out several billion dollars in TARP or other money and they don’t know what happened to it - it’s unaccountable. And they are allowed to keep their books secretive. Is there any way the people devaluing our dollars are personally profiting from that? I mean, if they cut our dollars by 50%, they are slitting their throats too - or are they? Could this be where the missing, unaccountable dollars have disappeared to? Why has there been no outrage? Or have I just missed it?
Larry Edelson Reply:
December 21st, 2009 at 10:59 am
Most of the TARP money has already been repaid. So, I’m not familiar with your information above. The TARP money is not what’s pressing the dollar lower. It’s the fact that the Fed can and will print money at will whenever they need to, and the growing recognition that Washington is dead broke.
Question on Dollar devaluation: If the US Dollar gets suddenly devalued, savings and business capital would be wiped out. What do you think would be the impact on stock prices, and within what time frame? Would foreign indexes like BRIC and EAFE move in the same or in opposite direction to US indexes?
Larry Edelson Reply:
December 21st, 2009 at 11:01 am
Stock prices would adjust upwards to revalue against the dollar. This is what’s happened in most economies where the currency was devalued, from Russia to Brazil. I expect the same to occur here.
When you say savvy investors borrow cheap money from the US to buy stocks in China for a better return what are you referring to? Selling on the forex market? The futures market? Other?
Larry Edelson Reply:
December 28th, 2009 at 3:37 pm
Chinese equities, and the spot and futures markets for natural resources, in general.
I’m very concerned about the financial well-being of my 4 sons and their children.
I want to purchase long-term investments on behalf of my 6 grandchildren (ages 2 - 9).
Any suggestions would be appreciated:
……what to purchase?
……one account, or separate accounts?
…. what entity can help me with managing such account(s)?
Have a Merry Christmas!
Larry Edelson Reply:
December 28th, 2009 at 3:38 pm
I, too, am concerned. However, as a publisher, I cannot render personal advice. Please follow the suggestions and recommendations in my Real Wealth Report.
Hi Larry,
Two or three kinds of adjustable rate mortgages are due to have their rates reset in 2010-2011 which is likely to result in a new wave of foreclosures and stress on local/regional banks. What do you visualize the principal profit opportunities will be from these unfortunate foreclosures.
Everett
Larry Edelson Reply:
December 28th, 2009 at 3:38 pm
I don’t see many in that area, and prefer not to profit from others misfortunes. However, on a macro level, I believe the foreclosures will cause credit conditions to tighten overall. So I believe positioning for higher interest rates is one way to profit.
how do I subscribe to your publication - Real Wealth Report.
I did subscribe to a Real Wealth report that I thought was yours,ir was not.
It was published by person name Dave (learned it after receiving first copy)his email address - finkd78@hotmail.com (learned it after subscribing)
kindly send me info.how to subscribe to your publication. thank you
Bennett Zwanger, shirben@verizon.net
Larry Edelson Reply:
December 28th, 2009 at 3:44 pm
Hmm. Not sure who that is, but it’s definitely not my Real Wealth Report!
To whom it may concern,
I am trying to get in touch with the blogger so I can include him or her in Wealthing.com’s Best Blogs on Wealth ebook. We would love the opportunity to work with you. Please contact me at my private email if you would like to participate. I value my time and promise to not waste yours.
Thank you, Sara Chapellin.
schapellin@mac.com
Larry Edelson Reply:
December 28th, 2009 at 5:32 pm
Thank you Sara. I’ll look into your blog!
Merry Christmas and a Happy New Year !
Very appreciate Your work and the work of Your team, expertise and recommendations.
Many thanks.
Larry Edelson Reply:
January 5th, 2010 at 11:38 am
Happy holidays to you and yours as well!
Larry, I forgot to mention that I also subscribe to your Resource Windfall Trader service Thank you, Greg.
I’d like to know some different scenarios that may occur with our money, i.e. we wake up one morning and the dollar has just been devalued. What does this mean?
WIN WIN SCENARIO FOR THE DOLLAR as posted by your own Bryan Rich Feb 6 2010.
Larry I would just like some clarification if I could please regarding recent statements by him regarding his very bullish sentiment on the US dollar.
In a nutshell he believes safe-haven demand for the dollar will continue to fuel it’s appreciation and rise.
You on the other hand feel we have nearly reached a peak and you stated it is unlikely to see the
dollar rise above 81 cents.
I would like to purchase inverse USD etf’s and effectively short it as it falls..but will it?
Thanks, I always take your statements as a cut above the rest.