After all the trouble in mortgage crisis, construction and housing price slump, endless billions bank write down, Analyst still expect service sectors stay above 50 with continued expansion?
I warned last Sept on this blog that Fed first rate cut that US economy will be drag into recession by banking, housing constrcution slump till 2008 summer despite any rate cuts, ISM index should test 40,now it plunged from 54 to 44 just reflect current state of this sector. We should not expect rate cuts, stimulus to stop housing prices and sales slump till summer. The ISM index will test 40 as stock market entering bear market correction.
However, rate cuts will give some support for consmuer, business demand and oil, commodities, inflationary pressure, drag us into 1980 style inflationaary recession,
and facing rate hikes in the second half.
So dollar is at the cross road, supported by inflation expectation and EURO, Japan slowdown, rate cuts.
EURO will be peaking out at 1.45- 1.55, Yen at 103- 108.
It is prematures for dollar specualtion
detials can be found on www.osawh.com/fund2008.htm
and www.osawh.com/currency.html
and www.osawh.com/Fedcrisab.htm
Comment byWarren Huang Wall Street Journal Mrket Beat Blog - February 5, 2008 at 2:22 pm
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I warned last Sept on this blog that Fed first rate cut that US economy will be drag into recession by banking, housing constrcution slump till 2008 summer despite any rate cuts, ISM index should test 40,now it plunged from 54 to 44 just reflect current state of this sector. We should not expect rate cuts, stimulus to stop housing prices and sales slump till summer. The ISM index will test 40 as stock market entering bear market correction.
However, rate cuts will give some support for consmuer, business demand and oil, commodities, inflationary pressure, drag us into 1980 style inflationaary recession,
and facing rate hikes in the second half.
So dollar is at the cross road, supported by inflation expectation and EURO, Japan slowdown, rate cuts.
EURO will be peaking out at 1.45- 1.55, Yen at 103- 108.
It is prematures for dollar specualtion
detials can be found on
www.osawh.com/fund2008.htm
and
www.osawh.com/currency.html
and
www.osawh.com/Fedcrisab.htm