Wisdom from Kansas

“Nothin last forever but the earth and sky It slips away And all your money won’t another minute buy”

The weak dollar strong equities trade has been working like a charm. Watch the UUP or the dollar index when it is weak you buy stocks when it is strong you sell them. Nothing fancy it’s just that simple.

When I know about it and they are talking about it on CNBC you need to start worrying.

When I first started on the Street conventional wisdom was the US consumer could not handle $50 barrel oil. It would be such a burden on people that they wouldn’t be able to buy anything other than the bare essentials and discretionary spending would dry up. Now crude below $65 or $70 is viewed as a sign of contracting global demand and a slowing economy.

My point is that things change and this weak dollar/strong equities trade will as well.

You need to ask yourself when does such a weak dollar start to become a real problem; or what causes the dollar to start to rally?

My guess is that answer lies in Washington DC somewhere. In the mean time this trade is the flavor of the month and we must monitor it. Because when it stops working Lord knows what is going to happen.