The Journal had a high profile story this morning on the lack of US concern over the weaker dollar.
There is basically one reason for that: It comes at little cost.
Look at the US bond market. US 10 year notes are at their lowest yields in over month, now at 3.29%
It is really hard for me to buy into the notion that we are in anything other than another 2008-style speculative commodities bubble. The players are the same (hawkish Trichet/dovish Bernanke) , the Chinese are buying each and every commodity under the sun, the dollar is headed to zero…
And don’t tell me the only reason yields are low is because the Fed is buying. Yields bottomed for this cycle in October, weeks before QE2 even began…QE2 is coming to an end, and the market knows it…
Somebody is right, and somebody is wrong. I’m betting the bond market is right and the commodities market is wrong.
