Woke up rather early today due to the large earthquake that struck the Kanto Region today. First off, "WHOA!" Earthquakes make a better 'alarm clock' - once the room starts shaking, I'm up and I don't want to go back to bed!
The quake struck just before 05:00. So, I flipped on the television and begin reading the newspaper. On the morning business news, the Japanese program host was speaking with someone from CSFB in NYC. The talk today centred on the topic of the strong yen, a.k.a. "the endaka" or (円高). One of the questions was "Will it reach 93 yen before the end of the summer?" Well, let me tell you, that questioned grabbed my attention. For a long time, I have predicted that due to the (lack of good) fiscal policies chosen by the GW White House, the US greenback will come under "EXTREME" pressure throughout the year.
There is no good reason why the US dollar should remain strong. I have long held the belief that the yankee dollar will drop to 95 yen to the dollar. Now, with this morning's show broaching the topic of a 93 yen-dollar, I am now thinking about readjusting DOWNWARD my predictions for the Yen-Dollar forex rate. Could the endaka continue rising past the 90 yen-dollar mark? Could it go as high as 85? If not, why not?
Nothing the US Administration is doing right now has shown any signs of fiscal responsibility. Rather, everything GW and his economic team has discussed implementing this year will only add more 'drag' to the dollar. So, the question becomes 'how low will the dollar go this year'? I shutter to think that it could pass the 85 yen mark. Yikes! Man the lifeboats! Grab the parachutes! Gather your children and 'head for the hills'!
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