Beware of the Dollar’s Coming Revenge

by Rick Ackerman

I was prepared to lead this week’s commentary with an emphatically bullish forecast for the dollar, which seems to have few friends these days. Alas, even though a major tone change is coming, it will be at least a few more weeks if not longer before this occurs, since the stock market looks as revved up as ever. Shares in a dozen or so mega-cap multinationals have been investors’ main alternative to the dollar, and the trends that have dominated each in recent months are equally senseless and overdone. The Dollar Index no more deserves to be trading in the dismal low-90s than Apple’s shares deserve to be valued at nearly $2 trillion. The inevitable reversal of these trends threatens to lay bare the Fed’s crackpot scheme to revive global prosperity with little more than monetary keystrokes, blandly reassuring press releases and some nutty policy mumbo-jumbo that could never have passed muster five years ago, let alone during times when the collective economic wisdom of Paul Volcker, Kurt Richebächer, Herb Stein et al. held sway. These days, the halfwits who invent the news know little of these men, only of Jerome Powell & Co., and the banksters’ improbable success at triggering a huge stock-market rally with the global economy poised on the edge of an abyss.

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