Lots of optimism seems to be embedded in the price of the euro based on the prospects for success at the upcoming summit among EU leaders; a summit effectively designed to remake eurozone countries in the image of Germany should said EU leaders expect more German taxpayer wealth to flow to the European Stabilization Fund.
Here it is – evidence that surging crude oil prices in the face of Libyan supply worries is too much for the global economy to handle:
Copper Futures, daily: who pulled the plug? Surging crude oil apparently is now a threat to global recovery. Not too surprising as the $100 per barrel threshold has been the pre-determined psychological tipping point for a while now. The move in crude higher has corresponded with a test of Copper’s 50-day moving average (orange line).
We think Chinese President Hu Jintao has it about right on the dollar.
"The current international currency system is the product of the past," Hu told the WSJ ... noting the primacy of the U.S. dollar as a reserve currency and its use in international trade and investment. He went on to say that loose monetary policy from the US floods the world with liquidity and the liquidity of the US dollar should be kept at a reasonable and stable level. Mr. Hu is right here too.
Scanning the Reuters headlines this morning we find the following array of not so good growth news gracing our otherwise happy Wednesday:
- Eurozone services growth declines¡Xdented by Ireland and Spain
- Spain services sector shrinks
Hopefully you know by now. In fact, it would have been nice to know a month ago ... or better yet six months ago (or even better yet two years ago!) ...
That’s when copper started up. And today it’s challenging record highs after screaming higher so far this month. (The previous peak was early 2008.)
