The U.S. economy is having major issues right now; all you need to do to confirm this is look at what the stock market has done over the last two weeks. But there is some silver lining to this: Europe’s economy is doing even worse over the same timeframe. The S&P 500 is down about 8 percent over the first two weeks of 2016, but major European indices are down around 10 percent over the same period. The German DAX is being hit the hardest, with losses closing in on 11 percent. At the same time, the British FTSE 100 is being hit far less severely, with losses of only about 6 percent throughout the first 10 days of 2016.
This is something that currency traders must take careful note of. The old nugget of wisdom that says when a stock market goes up, the dependent currency necessarily must go down needs to be reexamined. The U.S. economy’s failures should, (more…)