Click here for Martin’s take on the Fed’s push upward of the Dollar, whether that was their intention or not. From May 13th.
Probably why Ben is leaving in 2014….
And here for the impact of higher interest rates.
From the link above:
The realization that the expansion of the money supply by the Fed has failed to create inflation has befuddled every standard domestic economic theory. They have failed to graduate to the global level where they must realize that the dollar has emerged as a international currency going beyond a mere reserve currency becoming the currency of choice since there is no rational alternative. The expansion of the money supply by the Fed has been absorbed globally. The idea of stimulating through purchasing government bonds that in theory would put money into the system has failed to comprehend that 40% of the bonds are held by foreign entities. Thus, the old theories are just antiquated and have led to a massive level delusion everywhere from economics, share markets, gold, to interest rates.
Interest rates under domestic theory will have to rise to save pension funds. The Fed will not see the global implications and the huge dollar shorts and a rise in rates will spark a massive short-cover rally in the dollar. With the German elections looking more perilous by the day come September, the future going into 2016 could be a massive rally in the dollar coupled with rally in the Dow Jones Industrials that could reach 17330, 18900, or 23,388 by 2015.75. If the central bankers screw it up as usual, they could create a Japanese type bubble on this one.
