May 10, 2017

For the past six years, the USD/Euro Exchange rate has been less volatile than ever before

Some think not: It’s the most important price in the world: How many U.S. dollars does it take to buy one euro? The exchange rate between the two largest world currencies affects profits and financial conditions around the globe—and it has been dangerously unstable for more than a decade. Since 2007, the dollar-euro rate has swung up or down by about 20% no fewer than eight times. Exchange rates that gyrate this much produce crisis and weak economic growth, while undermining the case for free trade. The chart depicts three episodes since the birth of the Euro: The “gyrations” have… Read More


The FOMC thinks it´s coaching a “major league” economy

In a recent speech, Loretta Mester gave the impression the FOMC is dealing with a “robust or major league” economy. Excerpts from her speech, where the highlighted “descriptions” convey that view follows. She´s not alone. On the same day, San Francisco Fed president John Williams said: “Now that we’ve gotten the monkey of the recession off our backs, we have the luxury of being able to look to the future.” Mester: The Economic Outlook The economic expansion turns eight years old next month. It got off to a slow start from a very weak place, but now this expansion is one… Read More