Who? What? When?

Who? The Fed, the ECB, the BoE, etc, What? Unwind the large amount of policy accommodation. When? We don’t know but when the time comes whenever that might be. Fed Gov Warsh in the WSJ laid out what’s ahead for the Fed and said they will be aggressive in raising rates when the time comes. With US debt to GDP at 360%, we’ll see about that. Geithner said the US has an obligation to make sure “we are unwinding and reversing the extraordinary actions we were forced to take.” He also said “a strong dollar is very important in the US.” The FX market trades $3T daily so only actions not words will influence the $’s direction and today the $ is lower even with the comments. The Yen is at a 7 month high as the Japanese Minister reiterated that they don’t mind a strong Yen and the Euro is up after German consumer confidence rose to the most since June ’08. The Pound is the only currency the $ is seeing continued gains against.

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