Monday, April 25, 2011

Americans are more pessimistic about the nation’s economic outlook and overall direction than
at any time since Obama’s first two months in office according to a new NYT/CBS poll. The number of
Americans who think the economy is getting worse has jumped 13 points in just the last month. 57% of
the country disapproves of Obama’s handling of the economy. 72% of the country supports Obama’s
plan to raise taxes on the wealthy (those making > $250K) as a way to close the budget hole. – NYT
Has the US forgotten about its strong dollar policy? A growing number of economists believe
the US is passively accepting a gradual decline in the currency, hoping it will eventually stimulate the
economy. – Reuters

DXY is a measure of dollar performance versus six different currencies: Euro (57.6%), Japanese Yen
(13.6%), British Pound (11.9%), Canadian Dollar (9.1%), Swedish Krona (4.2%), and Swiss Franc (3.6%)

Debt ceiling – there is a growing sense among officials in Washington that Obama won’t be able
to get a higher debt ceiling w/o making sig. new concessions to Republicans on spending and the
budget. “some administration allies fear that only a major disruption in the bond and equity markets,
fueled by debt-ceiling jitters, will be sufficient to force the GOP to compromise”. – Politico
Violence exploded in Syria (the largest instances of unrest occurred over the weekend since
protests first broke out w/Asaad’s security forces cracking down hard and causing hundreds of deaths).
The White House is preparing to issue sanctions against senior members of the Syrian government who
are participating in the brutal crackdown on the country’s citizens. Meanwhile, Washington and its allies
view the Asaad regime as being increasingly fragile. The move by the Obama administration marks a
turn of sorts against the Assad regime although a cautious approach is still being pursued as other
governments in the region (inc. Israel and some Arab states) are reluctant to see a power vacuum
develop in the country.
Treasuries – a Chinese CB researcher said on Mon that Beijing needs to guard against volatility in
US Treasury prices. China believes demand for Treasuries will stay strong due to a lack of investment
alternatives. – Reuters – I guess that will have to do for now.