The dollar is all about the FEDs need to stay above 130 on the Euro...
So far so good.
But with the massive US deficits and consumer debt--and with the housing bubble now poping, and the knock-on effects from that...
The dollar will have to drop just to stay based in economic reality. Of course that effects gold and oil... Then the FED will step in and raise rates... And so it goes.
Our little summer honeymoon at the FED will have serious "costs" later this year...and on into 2007.
That is likely what the market is "really" reacting to today...
The weak manufacturing report is really the result of LONG TERM POLCIY DECISIONS that have been working against manufactuing inside the US for literally years...
