AUTOREFRESH 
Trichet: Don’t think risks of deflation could materialise
By Gerry Davies || June 24, 2010 at 05:25 GMT
|| 8 comments || Add comment
- Idea that austerity measures could trigger stagnation is incorrect
- Euro is very credible currency, a currency which safeguards price stability is a major asset in the eyes of investors
- Am confident we are on right track for regulatory reforms, a number of important decisions are to be taken at November G20
In trying to restore shattered confidence he sounds much like Bernanke and various bank CEOs prior to the unraveling of the credit markets here in the US in fall 2008. Soon, the more they spoke, the more the markets got spooked. Trichet offers no real substance, rather just generalities and appeal to the markets to trust him that things are better because he claims they are. The credit markets are telling a different story as they had prior to the US financial crisis. “Euro is a very credible currency,” you can almost here him wincing as he says that. He has repeated this statement a number of times over the past few months. If a currency is really credible, it’s usually not necessary to have to continually remind people that it is.
I agree. People do not usually say some is credible unless it is not. At present the politicians seem to be talking the Euro down. French politicians are talking about parity and the German politicians are doing everything to destroy the unity including spreading false rumours about Spain. Trichet is doing everything he can to stabilise the currency and is talking it up. Maybe the politicians see that a week Euro in the short term will really boost the Eurozone economies making exports really competitive. For example Airbuses are being bought like they are going out of fashion. There is no doubt that the euro will continue to weaken before rebounding once the Eurozone economies start to boom as a result of the stimulus caused by their competitiveness with the weak Euro. If that be the case, the Euro is currently not credible.
Hi, RS & Chris,
Completely agree ! They would like to talk down the fibre’s rate.
Had gone short upon 1.2340 with stop loss at 1.2377.
Again, thanks for Gerry’s information.
Just Booked 35 pips profit from 1.2340 short poition on EUR/USD
had gone short again at 1.2300 for USD/USD
Correction : Had gone short again on EUR/USD at 1.2300
Booked 30 pips profit (1.2270) from short position 1.2300 again.
Todays got 70 pips intraday profits, take a rest now !
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