The world needs:
1) strong USD, less risk premiums needed on credit, USD bonds. Domestic consumption of foreign exports. Relative cheaper commodity prices for domestic manufacturers(if there are any).
2) cheap JPY, exporting nations need a cheaper currency, especially when they are trying to get out of economic gloom.
3) dollar proxys: EUR GBP, some with a bias against the USD, will favor inflows into these.
4) cheap YUAN, cost of living is less for americans.
This ultimately leads to deterioration of manufacturing in this country and turns this country into a service industry. The USA creates instability all over the world, and USA into a premium local to live in. Everyone flocks to this nation for the service industry, whether it be the infrastructure or healthcare. So the rich of the world end up buying assets in the USA, and hiding money here instead of their own nations, where political and financial instability is worse.
This is the largest macro cycle around. Not sure when it will end.
1) strong USD, less risk premiums needed on credit, USD bonds. Domestic consumption of foreign exports. Relative cheaper commodity prices for domestic manufacturers(if there are any).
2) cheap JPY, exporting nations need a cheaper currency, especially when they are trying to get out of economic gloom.
3) dollar proxys: EUR GBP, some with a bias against the USD, will favor inflows into these.
4) cheap YUAN, cost of living is less for americans.
This ultimately leads to deterioration of manufacturing in this country and turns this country into a service industry. The USA creates instability all over the world, and USA into a premium local to live in. Everyone flocks to this nation for the service industry, whether it be the infrastructure or healthcare. So the rich of the world end up buying assets in the USA, and hiding money here instead of their own nations, where political and financial instability is worse.
This is the largest macro cycle around. Not sure when it will end.
Price is the only indicator.