jim sinclair:
"If the US bond market falls, the US equity market will be tested. You cannot remove a $72 billion dollar January 04 buyer from the bond market without removing the bull from both the bond and equity markets.
You remove the bull from the US equity market and President Bush would lose the upcoming presidential election to Mickey Mouse if the fury little rodent was the opposing Democratic candidate.
So Friday's yen market is a total disaster for the Republican presidential candidate. If the yen moves higher in US dollar terms, then there will be no need for Bank of Japan intervention and therefore no US dollar funds flowing to the New York Fed to be invested in US Treasury instruments.
An appreciation of the yen is the worst possible scenario for the bond market bulls. There is no question whatsoever concerning what has bulled both the US bond and equity markets. Kudlow and Cramer may be gleeful over the rise in the US dollar on Friday but it is the one singular item that will kill off the equity and bond bull markets deader than a door nail within fifteen trading days from the time the yen first rises.
The powers behind the throne of President Bush are not stupid. They might take a few days to wake up but wake up they will. This dollar rally and the yen over 109 is temporary or the Bush Administration is even more temporary. Just like his dad, President Bush might be the successful warrior but he will be as unemployed as his dad was after Kuwait or Churchill after World War II beginning December 1st of 2004.
That being said, Friday's dollar rally is temporary because President Bush intends to be elected or go down in flames, having tried every possible means both traditional and non-traditional including the military option. After November, the bill will be so high as to be beyond the means of anyone or anything to pay.
I do not see any chance of the dollar rally surviving the ides of March - if that. We are simply too close to November 04 to endanger the gains for the incumbent."
AI
