A few months ago, we heard that if the Fed would cut rates, the dollar would collapse. The Fed cut farther and quicker than any of these prognosticators thought, but the dollar has rallied five cents against the Euro. What happened? Not a peep from the dollar bears, as the ECB has proven itself to be as clueless as our Fed was.
Yesterday, it was reported by the media that Buffett said our dollar would be "worthless" if we continue our current account deficit. This morning, Warren Buffett called in to Becky Quick of CNBC and said he was misquoted. Here's what he said: "If our current account deficit keeps running at present levels, the dollar I think is almost certain to be worth less five to ten years from now compared to other major currencies."
Only in this market, where the professionals are completely fixated on the bearish side and over weighted with shorts can we have this nonsense.
They'll soon get schooled.