Econmatters | Sep 21, 2014 02:04AM ET
As I was shorting S&P 500 Futures late Thursday night it once again hit home how close financial markets are to some major shocks all due to ridiculous amounts of liquidity by Central Banks all over the world. The movements in the currencies as of late are starting to become worrisome, and with the movements on Thursday night I will not be surprised if we start having some currency inspired major volatility in other asset classes.
So late Thursday night Japan hits 2014 highs, then Europe hits 2014 highs, and the US Futures hit all-time highs, and I was struck by the fact that next month the Fed will still be buying 15 Billion of asset purchases for October.
Somebody Has to Have Relative Stronger Currency
We are starting to see the strain in the currencies, and everyone cannot debase their currency at the same time, and the market is starting to look away from the US Dollar being the weak currency, and if this continues Gold and silver markets will get destroyed, US corporate profits are going to get hit, and all the stock buybacks in the world are not going to help US Corporations hit the earning's marks.
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