Ok, I know I said I would get back to you with an evaluation of the US $700 billion resue package but guess what? It hasn't been approved yet after 9 days of deliberation !
It would appear that a few congressmen from both sides, including presidential candidate McCain, are less than enamoured with the details and are proposing an alternative deal. The upshort of this is that there is supposed to be an agreement by the end of this week-end........I guess from his point of view it makes sense to implement now what he may well be paying for if voted into office next year. Similarly for the Democrats.
Traders, me included, have been scrapping around this week looking for clues and the Dollar has traded in tight ranges compared to those of late. However, the uncertainty is keeping its value low making now an exellent time to contemplate that Florida condo or villa - the currency could well firm up once the rescue package is finalised.
Even news of the collapse of Washington Mutual, the largest failure of a U.S. bank thus far, has failed to make any real impact at present. This outfit had about $307 billion of assets and $188 of deposits and its banking assets were sold to JPMorgan Chase & Co for $1.9 billion.
In the Eurozone, one or two ECB members have been a little more lucid than before in their appraisal of their own economic mire and have intimated that they might be boardering on recession requiring interest rate cuts perhaps sooner rather than later.
In the UK, well you know the scene by now.............A mixed bag on exchanges with the worst of the economic gloom probably still yet to come.......
All this chaos is adding value to the tradtional safe-havens of gold and swiss francs while the emergency lending requirements from the central banks are on the increase as banks remain cautious about lending to eaach other.
That's about it for now. We await the the US package with keen anticipation and hopefully can start to establish new trend lines for next week and beyond. The bottom line is that with the world's economy in the brown stuff (not going for a cheap pun here......) picking any currency over another right now is really just the lesser of many numerous evils........
Have a good week and may the sunshine continue............