No, the Dow Didn’t Really Hit a New High — Plus, It’s Meaningless Anyway
About a week ago I mocked the notion that everything was hunky-dory because the Dow was at an all-time high. But I hate to admit that I had no idea just how meaningless that statistic was. For one thing, the Dow wasn’t actually at an all-time high.
And it gets worse from there. The Dow, which we all know as a stodgy and unrepresentative sample of 30 large American companies, is even sillier than I realized. I learned just how silly last night listening to this highly recommended Planet Money podcast from the right-wing hacks at NPR.
Let’s start with the (lack of) a new record. A couple of commenters, Dustin and SPQR, noted the issue: the Dow number doesn’t adjust for inflation. As Adam Davidson of Planet Money notes, this is completely absurd, because basically every economic statistic adjusts for inflation. The fact that the Dow does not is only one example of how silly it is. Adjusted for inflation, the Dow’s actual historic high happened in 2000. (And then . . .)
But it gets worse, because the Dow is an absurd measure of stocks anyway. Place to one side the fact that it’s only 30 stocks. (You’re far better off with something like the S&P 500 or the Wilshire 5000.) The other, even more significant problem, is the way that stocks within the Dow are weighted. Basically, they aren’t. This ridiculous measure simply adds up the stock prices (and then divides them by some proprietary divisor, which makes no real difference). What this means is that companies whose individual shares represent a greater percentage of their market cap have larger effects on the total number, which makes no sense.
IBM swings the Dow to and for out of proportion to its size, just because each of its stock shares is a higher percentage of its market cap.
The example Planet Money uses is this. Let’s say AT&T and IBM each have a market cap of $100. But AT&T has 100 shares and IBM has two. AT&T shares are worth a dollar; IBM shares are worth $50. If AT&T goes down 10% and IBM goes up 10%, the market is neutral. But each AT&T share goes down a dime. IBM goes up $5. So the Dow shows a considerable increase even though nothing has really happened.
Which is totally absurd.
So why is it this way? They talked to an expert, and apparently the answer is: the Dow was devised before computers, and they just made it really simple (read: inaccurate). In other words, it sucks because it’s old.
So why not change it? Because the Dow is considered valuable because it’s old. Seriously: that’s about the only thing it has going for it. If you change it, it loses its only unique feature: its age.
The best part is that Adam Davidson thinks people in the media, at least people who understand financial matters, know all this. Yet they still report on the Dow as if it means something. It doesn’t.
Even if it did, of course, the stock market is not an indication of how the economy is doing. But it’s very important to understand that the Dow is really a meaningless number that no sophisticated person pays attention to (except, perhaps, to gauge what direction the herd might be going).
UPDATE: That last parenthetical was added in response to a point made by a commenter.
You’re wrong. People do pay attention to the Dow because people pay attention to the Dow.
You’re right in that the Dow isn’t a measure of what most people think the Dow measures. But it is because most people don’t know what the Dow does that most people treat the Dow as if the Dow does measure what it doesn’t. And because they think the Dow measures what it doesn’t, they make investment decisions (such as changing their stock/bond allocation) based on what the Dow does… and since sophisticated investors take into account what the crowd is doing, in large part to make sure they get in and out before the crowd, sophisticated investors pay attention to the Dow.
steve (369bc6) — 3/13/2013 @ 7:42 amDecent point. Added a parenthetical to the end of the post.
Patterico (9c670f) — 3/13/2013 @ 7:48 amNow the sentence no longer ends with a preposition. Win-win!
Patterico (9c670f) — 3/13/2013 @ 7:48 amwith wealth effect i feel rich to where I want to spend spend spend
i bought a punchbowl it is mine no one can take it away not ever
happyfeet (8ce051) — 3/13/2013 @ 7:56 amThe Dow is like baseball hitting averages. Baseballs are harder now than they were 80 years ago, but we don’t adjust the batting averages to reflect that. And we feel (rightly or wrongly) that we have a tool to compare Derek Jeter to Ty Cobb.
The Dow is the same way: it is an indicator, not a measure, so — yeah, its utility is limited. But it’s still a useful benchmark for historical comparisons, especially over the long term.
Kman (5576bf) — 3/13/2013 @ 8:18 amComment by steve (369bc6) — 3/13/2013 @ 7:42 am
Painted Jaguar: Exactly!
Painted Jaguar (a sockpuppet) (3d3f72) — 3/13/2013 @ 8:21 am2 things:
jb (1e0905) — 3/13/2013 @ 8:57 am1. At its nadir 4 yrs ago, the Dow substituted out citibank and GE. where are those stocks today? still at rock bottom. So, if they were kept in, the Dow would not have hit new highs.
2. The S&P 500 is near all time highs, and is a broader measure. So, there *is* something going on in stocks: and that is is that it is the only place to put money given interest rates.
The DOW has always been described as a “leading economic indicator”, pointing to where investors THINK (hope/pray) the economy is going.
askeptic (b8ab92) — 3/13/2013 @ 9:00 amAnd Yes, it does represent the thinking of The Herd.
Although maybe I read too much without practical experience, Day Trading of a decade ago, done by chain-smoking recluses has been forever replaced with computers registering bids and offers in microseconds.
NSYE volumes are at historic lows but these programs bid the market up, especially near close, which like lately, were off on overnight trading.
Based on what? The ability to make a profit today. Not earn dividends not to sell at a secular bull-market high and buy at a corresponding bear-market low.
Just make money today and move on.
gary gulrud (dd7d4e) — 3/13/2013 @ 9:15 am“The Dow is considered valuable because it’s old. Seriously: that’s about the only thing it has going for it. If you change it, it loses its only unique feature: its age.”
– Patterico
It’s like originalist economics!
Of course, the Constitution has a lot going for it besides its age. But it’s an illustrative parallel, to my mind.
Leviticus (17b7a5) — 3/13/2013 @ 9:22 amYou and Ezra Klein would get along just fine.
JD (b63a52) — 3/13/2013 @ 9:25 amYou could argue the point, if you wanted.
Leviticus (17b7a5) — 3/13/2013 @ 9:29 amI think that point would make a little more sense if the Dow was a document that contained the foundational principles of our country.
JD (b63a52) — 3/13/2013 @ 9:34 amWhy? What’s the difference?
Leviticus (17b7a5) — 3/13/2013 @ 9:38 amThe Dow is the same way: it is an indicator, not a measure, so — yeah, its utility is limited. But it’s still a useful benchmark for historical comparisons, especially over the long term.
Comment by Kman (5576bf) — 3/13/2013 @ 8:18 am
— Shorter Kman: “We all know the ball is juiced, but it’s still so COOL to watch it sail out of the park!”
Icy (166313) — 3/13/2013 @ 9:39 amZing.
Leviticus (17b7a5) — 3/13/2013 @ 9:40 amI think a football might be the more appropriate analogy, though.
Leviticus (17b7a5) — 3/13/2013 @ 9:41 amGonna submit a COTUS revised for the 21st Century as your Masters Thesis, Leviticvs?
Icy (166313) — 3/13/2013 @ 9:43 amWhat is the difference? One is the basis for our system of governance, oft ignored, while the other is a relatively narrow sample of what were once blue chip stocks, subject to the change if they arent performing, that may or may not indicate in what direction our economy is heading. Other than that, exactly the same 😉
JD (b63a52) — 3/13/2013 @ 9:45 am“Gonna submit a COTUS revised for the 21st Century as your Masters Thesis, Leviticvs?”
– Icy
I’m in law school. We don’t talk about ideas, there’s too much to do.
Had a class as an undergrad, though.
Leviticus (17b7a5) — 3/13/2013 @ 9:48 am“One is the basis for our system of governance, oft ignored, while the other is a relatively narrow sample of what were once blue chip stocks, subject to the change if they arent performing, that may or may not indicate in what direction our economy is heading.”
– JD
If I were to stipulate that Patterico is objecting to the idea that the Dow has merit by mere virtue of its historical roots, and to point out that originalism is premised on the idea that the Constitution’s virtue lies in its historical roots, would that help bring my question into sharper focus?
Leviticus (17b7a5) — 3/13/2013 @ 9:52 am10,12,14. You’re reading into the comment. A legacy measure renders comparison between eras once adustments for inflation are made.
That’s all he’s implying.
gary gulrud (dd7d4e) — 3/13/2013 @ 10:01 amClimate Science and Solar Science are currently changing both criteria of measurement and updating existing, legacy, data for assumed error.
Effectively this destroys comparison across era. Specious arguments aside, the result is a boon to propagandists.
gary gulrud (dd7d4e) — 3/13/2013 @ 10:05 amFair enough. Are you saying inflation is a concept that eludes analogy?
Put another way, you’re saying (or you’re saying that Patterico’s saying) that a legacy measure requires frequent adjustment to be of any use.
Leviticus (17b7a5) — 3/13/2013 @ 10:05 am24. Yes to the latter. Inflation precludes direct comparison of Dow 2000 in, whatever, 1946 with Dow 14,000 today. Beside inflation other adjustments are popular, P/E ratios, Margin percentages. Not my strength but they get quite complex looking for major inflection points in trading.
Right now, the lack of transparency in price discovery information is exercising the financial analysis crowd, generally.
gary gulrud (dd7d4e) — 3/13/2013 @ 10:15 amRight. I’m agreeing, then. I just think the principle extends further.
Leviticus (17b7a5) — 3/13/2013 @ 10:17 amI know very little about this, but I did here a comment the other day from a guy who is a day trader who is doing well, who also said, “Oh no, I rarely hold on to anything”.
So the idea that people are making money on a daily basis and prices are being driven up- as no one wants to put money in zero interest maoney market account.
But the historic argument, as far as i know, was that the American economic engine was “aways going to grow over time because it always has”, so buy and hold on- this for the masses who do what their advisors tell them.
“Always” is not very long if you are talking in terms of decades, not centuries or millenia.
MD in Philly (3d3f72) — 3/13/2013 @ 10:23 amSorry, Leviticus. I was being too snarky.
JD (b63a52) — 3/13/2013 @ 10:31 amNo worries. I’m often too snarky, myself.
Leviticus (17b7a5) — 3/13/2013 @ 10:40 am“and since sophisticated investors take into account what the crowd is doing”
steve – Sophisticated investors are the crowd in the stock market. Individual investors are a minority.
daleyrocks (bf33e9) — 3/13/2013 @ 10:48 amYou write “the Dow is really a meaningless number that no sophisticated person pays attention to” and “You’re far better off with something like the S&P 500.”
I think that’s just plain wrong. Go to a charting site like BigCharts.marketwatch.com. Chart the DJIA over 5 years. Now overlay (“compare”) the chart for the S&P 500. You’ll see they correlate almost perfectly. So how can it be that one is meaningless, and the other is far better, when they match each other so closely?
The “stupid” thing about the DJIA is that many people think that it is a proxy for the health of the US economy. No stock price index tells you the health of the economy, nor of the future of the economy. People came to revere “the Dow” because it’s the headline number that the talking-head news media bleats at them on every evening newscast.
If you’re going to follow a stock price index at all, the best one to choose is the one that matches the particular portfolio you’re studying at the moment. If your portfolio under study consists entirely of DJIA ETF shares, then the DJIA isn’t a bad index to look at. But you don’t even need canned indices anymore, because with modern charting tools (like ThinkOrSwim,) you can construct any custom chart or index you might want.
Just don’t think that your favorite stock price index has anything whatsoever to do with the present or future state of the economy. Even under this disastrous BHO economy, we’ve had a four year stock price rally.
gp (5a38d9) — 3/13/2013 @ 11:07 amI have read that we have not had a stock price rally.
What we’ve done is inflate the currency so the numbers are higher. The stock prices naturally reflect this.
So our higher Dow and S&P are really just tracking our inflating monetary supply.
The facts on the ground haven’t radically changed for all but a few industries (fracking) and most companies are in a holding pattern to see how things fall out. No ‘next big thing’ appears to be on the way.
(Yes, I know about tracking inflation and how the government numbers don’t include food and gas.)
luagha (5cbe06) — 3/13/2013 @ 11:24 amI have read that we have not had a stock price rally.
What we’ve done is inflate the currency so the numbers are higher. The stock prices naturally reflect this.
So our higher Dow and S&P are really just tracking our inflating monetary supply.
Yes. This.
JD (b63a52) — 3/13/2013 @ 11:29 am“The “stupid” thing about the DJIA is that many people think that it is a proxy for the health of the US economy. No stock price index tells you the health of the economy, nor of the future of the economy.”
gp – I think this is a better argument. While I think the level of a stock index contains information about the expectations of the individual stocks comprising it and the general direction of the economy, unless you know how the index is constructed and weighted, its value as a signalling tool can be limited, apart from saying bonds are less attractive, for example. There was a period of many years when the market capitalization of Microsoft made many stock indexes in which it was included virtually useless due to its overwhelming size.
daleyrocks (bf33e9) — 3/13/2013 @ 11:40 amWith respect to inflation, please remember that we have no way of measuring actual inflation, e.g., the change in the value of money.
All we can do is measure the change in the prices paid for goods/services. But often the price of something changes from its relative supply/demand separate from a change in the value of money.
Just as an example, say we have an economy that only has two goods: coal and corn. And we use clam shells as money.
If the coal mine produces less coal, but demand stays the same, then the price of coal rises but corn does not. Did we have inflation? No, the value of money did not change. But a “consumer price index” would go up. Say that a drought causes a shortage of corn for a season, but we have the same amount of coal. Again the “cpi” would rise but money did not inflate.
But lets say that coal and corn supply and demand are stable, but someone finds a huge trove of clamshells in a hidden stash, and starts buying up all the coal and corn he wants with them. And people are awash in shells chasing the same amounts of coal and corn. That’s inflation.
We can’t directly measure inflation, we can only indirectly measure it by aggregating all of our goods in some hypothetical “typical” basket of goods and measuring their prices. And that’s what is reported on the news as “inflation”, that price index. But if goods become cheaper because their raw materials are in greater supply, or its becomes easier to make them due to automation, that may hide the fact that the overall money is less valuable, or inflated.
Likewise, in a different way, the DOW 30 is a stupid measure of even equity markets conditions because it is a small sample of atypical companies.
SPQR (768505) — 3/13/2013 @ 11:52 am“So our higher Dow and S&P are really just tracking our inflating monetary supply.” Yes, but only to the extent that the extra money finds its way into US stocks, which depends on the confidence of investors.
Stocks are just one asset type among many, so stock price indices, compared to other asset price indices, would tell you how much people prefer one asset type to another.
Just don’t expect stock prices to track monetary supply forever. At some point, stocks will go out of favor, and stock price indices will decline even as money supply increases.
gp (5a38d9) — 3/13/2013 @ 12:18 pmI was thinking yesterday about how much lunch at Wendy’s cost relative to an hour’s work at minimum wage compared to a lunch at MacDonald’s 30 years ago relative to an hour’s work at minimum wage then. I think it is roughly equivalent, but I could be wrong.
MD in Philly (3d3f72) — 3/13/2013 @ 12:25 pmFull disclosure: I’ve enjoyed the rally since the 2008-2009 panic. I won’t add to my stock ETF positions at current prices, but some individual stocks might still be buyable. E.g., AAPL is intriguing right now, with P/E under 10 and yield over 2%. There’s always something underbought somewhere.
I do expect another panic at some point. I do expect the American standard of living to continue to decline, with increasing frequency of financial crises and failures. I won’t be a bit surprised if some new major theater of war opens up.
gp (5a38d9) — 3/13/2013 @ 12:35 pmComment by gp (5a38d9) — 3/13/2013 @ 12:35 pm
Will you let us know when you sell off?
MD in Philly (3d3f72) — 3/13/2013 @ 12:37 pmWith respect to inflation, please remember that we have no way of measuring actual inflation, e.g., the change in the value of money.
That’s what The Gold Standard was for!
askeptic (b8ab92) — 3/13/2013 @ 12:45 pmI won’t be a bit surprised if some new major theater of war opens up.
Sub-Saharan Africa is always a possibility.
askeptic (b8ab92) — 3/13/2013 @ 12:48 pmThere are so many local conflicts going on at any one time, it doesn’t take much to make something minor, major – particularly where there’s an Islamic interface.
“Sub-Saharan Africa is always a possibility.” “Islamic interface.” I’m thinking Asia: DPRK vs somebody, or China vs Japan or Taiwan. God, I hope not. Nuclear terror is inevitable I think; just a matter of when.
“Will you let us know when you sell off?” I got my current portfolio so cheap, I doubt I will ever sell unless I’m destitute. I could ride a 50% loss and still be ahead in unadjusted USD.
If somebody ordered me at gunpoint to buy a stock fund right now, with my own money, I’d buy one of those world telecom ETFs. You get a good yield, plus everybody loves to yak on their cellphones. I see the poorest people in town with cellphones stuck in their ears 24/7. Might as well take 5% of what those suckers are paying in.
gp (5a38d9) — 3/13/2013 @ 12:57 pmgp, the Fed is expected to buy nearly 90% of all Treasuries in 2013.
Naturally, this can’t continue forever but it’s the only tool left in the administration’s toolbox. And it isn’t much of a tool. It’s the only thing propping up the bond market and so far keeping interest rates low.
Naturally we can expect more financial crises; the bond market collapse, the stock market bubble bursting, rising interest rates destroying jobs and the housing markets, more bank failures, etc.
But they’ll worse than 2008 because all we’ve succeeded in doing is digging a bigger hole for ourselves.
Steve57 (60a887) — 3/13/2013 @ 1:20 pmI’m still stunned that the Federal Reserve is buying up most of the $1 trillion plus deficit in printed-up funny money … and people just ignore it like its not a problem.
SPQR (768505) — 3/13/2013 @ 1:28 pm“this can’t continue forever” Yeah, it’s crazy, isn’t it? We’ve been hearing for many years, from many different sources, about how our finances are on an unsustainable course, yet Krugman, the Obamabots, the media, and the general public are completely unconcerned. We’re on the Highway to Hell, but when even some little piddling stupid cost-cutting measure is taken, like shutting down White House tours, everybody, even so-called conservatives, howls in outraged pain: OMG DON’T CUT _THAT_!!!!
You’d think people would have gotten the message from the Sep 2008 panic, but that’s forgotten now. It’s just so nutty.
gp (5a38d9) — 3/13/2013 @ 1:36 pmthe Fed is expected to buy nearly 90% of all Treasuries in 2013.
Which is why, since QE-2, what little I have has been invested in a world-wide commodity fund, because when Wiemar hits, it’s going to hit us good and hard.
“Democracy is the theory that the common people know what they want, and deserve to get it good and hard.”
askeptic (b8ab92) — 3/13/2013 @ 2:23 pmPeople can be fooled by false measures like the DJIA, the CPI, the Unemployment Report, etc., because they desperately want to be.
We talked about the fact the DJIA is not only a poor measure of the economy but not a very good measure of what it purports to measure; the overall strength of the stock market.
It isn’t adjusted for inflation, and it can be fudged by swapping out Dow components. The CPI (to be clear CPI isn’t the inflation rate but the starting point for calculating it) can and has been tweaked the same way; in 1980 under Carter they changed the criteria for measuring inflation to make the administration look more effective than it was during the run-up to the election. They did the same things in the 1990s. I’ve noted before that if we were using the same pre-1980 and pre-1990 criteria for the CPI then inflation would be calculated at approximately 10% and 5.5% now rather than the average 2.07% it was calculated at in 2012.
As long as the CPI can be tweaked then Bernanke can continue his loose money policy and claim there are no inflationary worries in doing so.
Unemployment numbers are another big scam. Last months jobs report was hailed as “strong.” It was anything but.
The Unemployment Tragedy the Media Won’t Report
The last point is especially important. If you’re lazy you might hear 236,000 jobs were created and assume that meant employment for 236,000 people. It doesn’t. And that problem is only going to get worse as Obamacare is implemented. Businesses are cutting people back from full-time to part-time, and making sure their part-time workers work no more then 29 hours a week.
What Obama Is Doing to the Job Market
If you look at the economic realities there isn’t any good news. 300,000 people dropped out of the labor force in February. 236,000 jobs were created but not for 236,000 people. Workers are being forced to trade their 40 hour/wk jobs for 2 or three 15-25 hour/wk jobs to try to make ends meet. And soon it may not be worth even trying to do that.
This explains the spike in stock prices. There really aren’t a lot of attractive investment options for most people. Businesses are going to have a hard time attracting capital as people are forecasting it’s more likely they’ll have to shut down then expand. Real estate is not a good option except under some narrow circumstances.
For most people stocks and commodities are pretty much it. That’s where the easy money is flowing, hence the “historic highs.”
The administration is literally trying to paper over the grim realities by printing money. That will fail. Peter Schiff predicted on some financial news show (I forget which he was on) that the bottom will drop out of the economy during Obama’s second term. That this plan of theirs isn’t sufficient to kick the can down the road so the economy can fall apart on someone else’s watch.
Because people are noticing they don’t actually have a plan. There plan is to fool people into believing they have a plan.
International Business Times: No Easy Escape for the Fed
This will not turn out well at all.
Steve57 (60a887) — 3/13/2013 @ 3:05 pmI’m in law school. We don’t talk about ideas, there’s too much to do.
Comment by Leviticus (17b7a5) — 3/13/2013 @ 9:48 am
— Hey, who do you think wrote the bloody thing in the first place; farmers?
Icy (166313) — 3/13/2013 @ 3:30 pmThis will not turn out well at all.
Comment by Steve57 (60a887) — 3/13/2013 @ 3:05 pm
I can’t imagine any smooth way out for the Fed. The rubber band is going to snap back sooner or later.
SPQR (768505) — 3/13/2013 @ 4:09 pmIt’s ignorant to talk about “historic high” for the Dow. The 1929 Dow is still the historic peak of the stock market, although the stocks are different. The 1929 Dow peak was 381.17 and gold was $20 an ounce. Today, gold is approximately $1600. That is 80 times the 1929 price. 80 times 381.17 is 30493.6.
Sorry, it’s not even close.
Mike K (dc6ffe) — 3/13/2013 @ 4:38 pmHeh! How about in 1929 you had to pay 19 golds for a DOW. Now you can buy a DOW for about 9 golds? 😉
I like the Big Mac theory of monetary value.
nk (53646e) — 3/13/2013 @ 5:10 pmFed expected to buy 90% of government debt in FY 2014 …
… “not end well” is an understatement.
SPQR (768505) — 3/13/2013 @ 6:06 pmHow so? And what is “originalist economics”? Are you talking about greenbacks (which I am watching an interesting video about called Secret of Oz) or just the Constitution or what?
Patterico (9c670f) — 3/13/2013 @ 6:30 pm52. That’s one big stick there fella. No wonder the stock market is Ok. Banks on two continents are flush with free money to buy equities.
The BoJ will be buying stocks directly.
gary gulrud (dd7d4e) — 3/13/2013 @ 10:14 pm54. Oh, the link, naturally:
http://directorblue.blogspot.com/2013/03/quantitative-sleazing.html
Now if I could only find my mind.
gary gulrud (dd7d4e) — 3/13/2013 @ 10:16 pmSecond week of net fund outflow, no matter Dow keeps rising:
http://www.zerohedge.com/news/2013-03-14/rip-rotation-two-weeks-us-equity-fund-outflows
gary gulrud (dd7d4e) — 3/14/2013 @ 6:09 am(1) There’s money to be made in the market by smart traders (and by all whose income comes from market transactions and commissions) whether the market is going up or down.
(2) Tomorrow’s losers are, by definition, those who turn out to have been wrong about today’s prospects.
(3) I’m not pessimistic about the stock market, in particular, in the very short term (e.g., for the next calendar quarter). However, I believe we are headed for a global economic collapse that will likely be triggered abroad (I’m looking at China and the disintegrating EU), but in response to which the debt-heavy public sector of the United States is going to topple over badly. I’m still bullish about the far future for America, but it is now already inevitable — and has been at least since last Election Day — that we’re all in for a world of hurt before then.
Beldar (de838d) — 3/14/2013 @ 10:44 am(Oh … yeah, it will also all be George W. Bush’s fault.
And … racist!)
Beldar (de838d) — 3/14/2013 @ 10:47 amComment by SPQR (768505) — 3/13/2013 @ 1:28 pm
44.I’m still stunned that the Federal Reserve is buying up most of the $1 trillion plus deficit in printed-up funny money … and people just ignore it like its not a problem.
Then you really should be stunned at this:
http://online.wsj.com/article/SB10001424127887324096404578356493055555934.html
FOREIGN EXCHANGE March 13, 2013, 8:09 p.m. ET. The Almighty Dollar Is Back …
…The WSJ Dollar Index, a gauge of the dollar’s exchange rate against seven of the world’s most heavily traded currencies, is up almost 5% this year and hit its highest level since July 2010 on Monday.
Every Dollar created by the fed is pure gold.
Sammy Finkelman (d22d64) — 3/14/2013 @ 4:41 pm59. Actually, in this race to the bottom, Japan has siezed a formidable lead. Now that the EU breakup is back on again that basically leaves the US as odd man out, with Swiss franc, British sterling and EU euro tied together at the ankles.
Apart from the benighted Japan, who had no choice but to jump in, the remaining places will see plenty of back and forth in the next couple of years.
But we are in the end game. Greece and Spain are doomed, we’re just waiting for civil war. Italy and France are in deep do do. Italy can save itself ditching the euro. But nothing will happen with the last two until after summer.
gary gulrud (dd7d4e) — 3/14/2013 @ 6:35 pm