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The Independent Investor: Sour Grapes
Bill Schmick,
11:38PM / Wednesday, November 10, 2010
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As the G20 conference gets under way today in Korea, I expect the currency war will escalate now that the U.S. Federal Reserve has launched the second round of quantitative easing. As the dollar continues to decline, our trading partners are getting back a little of their own and they don't like it.

Over the last week or so, the Fed's QE II announcement has been greeted by a chorus of howls from all over the world. Germany's finance minister called U.S. policies "clueless" while Chinese officials quickly added their own criticism.

"As long as the world exercises no restraint in issuing global currencies such as the dollar, then the occurrence of another crisis is

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@theMarket: Marking Time
Bill Schmick,
10:41PM / Friday, October 29, 2010
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This coming week will be a humdinger for the markets. The Federal Reserve is expected to begin a second round of quantitative easing and voters will deliver their verdict on the economy in mid-term elections. Both events will have ramifications for investors and stock markets worldwide.

The Fed's decision to further stimulate the economy via a second round of quantitative easing (QE II) has already been priced into the market, in my opinion, but the impact of the mid-term elections has not. If the Republicans gain a majority in the House and additional seats in the Senate, as many political pundits predict, then the markets have reason to rally in the months, if not weeks ahead.

For

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@theMarket: Third-Quarter Earnings Reveal Two Economies
Bill Schmick,
09:14AM / Saturday, October 23, 2010
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With one quarter of the companies in the S&P 500 already reporting, third quarter earnings have been a positive surprise. Eighty-six percent have exceeded earnings estimates and 67 percent have posted higher revenue numbers. What the numbers don't say is that most of those gains have come from overseas.

The revenue number is where we should focus our attention. Higher earnings can be achieved by simply continuing to cut costs (by firing workers, for example). However, looking at the revenue numbers gives us a clear understanding of where the growth is coming from. Not much of it is coming from the home front. A lot of that growth is coming from higher sales in Asia and other emerging

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The Independent Investor: The Coming Currency War
Bill Schmick,
11:15AM / Friday, October 15, 2010
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The International Monetary Fund and its members were in no mood to agree on a unified policy of currency movements at their weekend meeting in Toronto. Finger pointing and veiled threats of retaliation were hurled at China from both American and European members, among others. Underneath all the rhetoric, I fear we are in a race to the bottom as countries vie to reduce the value of their own currencies while demanding that others strengthen theirs.


Back in early 2009, in several columns, I speculated that just about every country in the world would try to export their way out of recession. In order to do that, each country would endeavor

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The Independent Investor: Does Cash Mean Currencies?
Bill Schmick,
02:09AM / Friday, September 03, 2010
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There was a time when one of the rules of asset allocation was to always keep a little cash in your portfolio. Cash was the safest bet you could make. It became the place where we retreated when the markets were in free fall. Today, however, cash as an asset class, earns almost nothing. As a result, many individual investors are using that cash to trade currencies and in the process transform the world’s safest investment into something a lot more speculative.

The headline on the front page of Wednesday's Wall Street Journal read "Currency Trading Soars." The article explained that buying and selling currencies has become a $4 trillion a day market. How much of that

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