Telling Trend Reversals: The Dollar and Bonds

Telling Trend Reversals: The Dollar and Bonds: "In last week’s Money and Markets column, I wrote about Bernanke’s quantitative easing policy. The goal of the policy is to create higher stock and housing prices by pushing the dollar and interest rates down.

So how is the Fed’s plan going? Let’s start with the …"

Norton's comment: This is a very telling article with a number of charts to illustrate what is really happening.  QE2 is NOT doing what the FED stated goal is to be.  Supply and demand as it related to the supply of money is operating as one would expect. Too many dollars are chasing investors when China, India, Brazil and other countries that buy us Treasury bonds are suspecting that our FED is driving down the value of our dollar so as to payoff US Govt debt with less valuable dollars.  Countries holding our debt do NOT want their investment devalued; that is, the future purchasing power of their investments in the US Treasuries diminished..