The Fed has been trying to sink the $ for nearly a year.
Oil is traded in US dollars.
Inflation caused around the world by US monetary policy is now coming right back at the US.
The two most common consequences of trashing the US$ have been:
- Foreign entities do not want to invest and help to curb the rising US debt.
- Dollar based commodities rise in proportion to $ falls and thereby destroy forward momentum.
Protectionism does not work in 2011 because the world is too intertwined. Case in point is the price of the US oil dependency.
Know how to trade? We do.
