Dollar vs Euro
From WSJ (link inside post):
That's why Deutsche Bank expects the euro to keep falling to 90 U.S. cents by the end of 2016 and 85 cents by the end of 2017
You think this prediction will ring true? Already planning that trip to Europe?
http://www.washingtonpost.com/blogs/wonkblog/wp/2015/03/10/at-this-rate…
On the forecasts, who knows. I'm convinced that, like oil prices, currencies are a variable that nobody can predict accurately. The same analysts (not sure about DB, but in general) were predicting the floor at much higher levels not so long ago, when the material facts were not so different than they are today.
Throwing my hat in the ring, my guess is that there will be sufficient forces acting in the opposite direction to prevent the euro from sitting at those levels long-term. The U.S. may be forced to keep rates very low. U.S. stocks would seem likely to fall, as earnings of multinationals will be challenged significantly at 0.85 or 0.90. The strengths in the U.S. economy that are driving the strength of USD will be partially reversed automatically by market forces.
What makes you think that?
-On gov side, seems that Fed is more likely to be conservative in raising rates, fearing the effects of the dollar being too strong -Earnings of major U.S. stocks / indices will be significantly affected by a stronger dollar. Growth rates (or in fact negative earnings growth) will make current stock valuations difficult to defend.
What happens to demand for USD if higher expected rates don't materialize and U.S stocks suddenly look like a bad place to be?
Of course the problem is, when you get into macro forecasting there are so many forces that act in opposing directions, muddling the analysis to the point of futility. For example, in the short-term, earnings of U.S. businesses with European presence will decline; but one of the causes of the weakening euro is that rates are also close to zero in Europe, which allows these companies the ability to borrow in Euros and lock in very low rates, in the neighborhood of 1% or less.
Greece can't pay what they owe.
I just hope the pound moves so I can afford a FT subscription
There's no reason why EURUSD can't go to 0.9. Anything can happen.
Iceland drops EU membership bid http://www.bbc.com/news/world-europe-31862988
Don't think ECB's new round of QE has been priced into the equity market. Could see some support for EUR from equity inflows but no idea where the floor could be.
Couldn't pay me enough to step in front of the current momentum.
My portfolio is probably at least 40 percent exposed to the eurostoxx 50 with a 2x upside lev.
Letssss fucking go
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