China Hit By Liquidity Fears As Dollar and Gold Stage A Dual Rally

The Business Insider ^ | 7-5-2010 | Vincent Fernando, CFA

[blam]

China Hit By Liquidity Fears As Dollar and Gold Stage A Dual Rally

Vincent Fernando, CFA
Jul. 5, 2010, 6:04 AM

Japan saves Asia from China malaise

Chinese stocks ended lower today, potentially on liquidity concerns related to both the upcoming Agricultural Bank IPO and an issue of shares from Bank of China. Yet a strong Nikkei performance kept the MSCI Asia Apex 50 in the green:

Asia: +0.5% (MSCI Asia Apex 50)

Japan: +0.7% (Nikkei)

China: -0.9% (CSI 300)

Hong Kong: -0.3% (Hang Seng)

Australia: -0.4% (ASX 200)

Europe stumbles out of the gate

So far European markets are losing ground, but with relative strength in Germany and relative weakness in the U.K. The euro is also falling.

London: -0.9% (FTSE 100)

Paris: -0.3% (CAC 40)

Frankfurt: -0.04% (DAX)

The Euro: $1.25

Gold and USD stage a dual rally

Both the dollar and gold are peculiarly rallying. Oil is up as well.

Dollar Index: +0.2% (DXY 85.6)

Gold: +0.2% ($1,210)

Oil: +0.7% (Light Sweet Crude $72.12)

Baltic Dry Index: -3.0% (BDI 2,280)

U.S. markets are closed today.

[snip]

[chopperman]

Excuse me, but Gold is down:

http://www.kitco.com/charts/livegold.html

[blam]

Gold Ping.

[wolfpat]

This scares me. I know enough about basic economics to know that our economy is headed down the crapper. If the Dollar is rising against the rest of the world’s currencies, that means their economies are already there.

We MUST get rid of Pelosi, Reid, and whoever is pulling Obama’s strings (Soros?).

[Ghost of Philip Marlowe]

Part of the great “recovery” lie is the “strength” of the US dollar.

As you rightly pointed out, it is being compared to a basket of currencies, each of which is falling from the sky at 2000 feet per second.

The US dollar is only falling at 1500 feet per second, so it appears stronger than it is.

Truth be known, the US dollar is the biggest bubble out there right now. When it pops, the s*** will splatter all over the globe.