Global Currents

In brief:

  • Riccardo Barbieri argues that China’s swelling currency reserves may relegate the dollar and euro to trading ranges, “effectively ending their free float in the market.”
  • Overnight in Tokyo, the dollar fell to “a fresh post-intervention low against the yen” of 83.23, despite the Sept. 15 dollar-buying spree by the Bank of Japan. Traders are on edge about another intervention.
  • The US House of Representatives voted to allow tariffs on Chinese goods. Andrew Peaple thinks the move “has much to do with political posturing ahead of US mid-term elections,” but notes that “strong voices in Beijing” don’t want to look weaker than US politicians. China already cried protectionism.
  • The Financial Times reported that the European Central Bank has been steadily weaning banks off of supportive liquidity. That plus improving sentiment suggests that the recovery in Europe “remains on track.”
  • Morgan Stanley analysts found that in Asia ex-Japan and ex-India, the “food inflation rate increased to 6.5% in August from 5.3% in June and 3.3% in Jan-10.” They worry that “any quick acceleration in oil prices could pose a significant risk in light of already rising food prices.”

In a little more detail:

  • Japanese companies seek new rare earth metals suppliers. A recent diplomatic spat between Asia’s two largest economies led to “a de facto ban” on shipments of rare earth metals from China to Japan. It’s created opportunities for non-Chinese suppliers because Toyota Motor Corp (TM) and other “Japanese customers of rare earth metals are looking elsewhere.” Top of the potential supplier list: Australia’s Lynas Corp (LYC.AX) with deposits in Malaysia. Rare earth minerals are “vital for Japan’s key auto and electronics industries.”
This entry was posted in Fiat Currency, Geopolitics. Bookmark the permalink. Both comments and trackbacks are currently closed.
  • The Kelly Letter
    A Complete Investment Management System
    The Kelly Letter  every Sunday morning by email.
    Like no other. Many subscribers say this is the best read of their week, astonishing in its ability to distill seven days of noise into one succinct overview of the very few items that might matter. Start your Sundays right!
    A one-page Quick Start Guide
    with page number references to full information in The 3% Signal. You'll receive access to this right away so you can begin transforming your portfolio into a performance machine immediately.
    The 3Sig Calculator.
    A thing of beauty! You'll use it to generate your own personal signals every quarter including exact share amounts to buy and sell based on your account balances. It emails you the results to make later quarters easy by keeping last quarter's numbers at your fingertips. Some subscribers say this tool alone justifies their subscription price.
    The subscriber-only section of this website
    where likeminded investors are commenting on notes and discussing in forums. Jason joins these interactions every day. They're a treasure trove of investing tips and wisdom.
    The archive of Kelly Letter notes.
    It’s a research center, searchable and smartly tagged to make gathering time-stamped material on covered subjects easy.
    The subscriber podcast.
    Jason reads every letter word-for-word. This feature was requested by subscribers who prefer audio learning. They listen on their Monday morning commute, during a workout, or while reading along at their computer.

    Save 17%

    Pay as you go
    Or sign up to receive free email and learn more about the system.
Bestselling Financial Author