Image Source: Pixabay

“Davidson” submits:

With panic in streets at some parts of the country, with massive fraud being committed and overlooked perhaps protected by politicians and global relationships in flux there are many forecast that the US$ is no longer the reserve currency it has been for many years. By my analysis this is all self-interested fluff designed to game politicly and personally.

A 40yr+ history of the DXY Index shows the US$ is not collapsing as these actors claim. There have been many factors for US$ strength in the past. It has been a haven during stressful times as during COVID and it has been the place for opportunity as during the lead-up to the Internet Bubble.  Recently Trump settled multiple long-term local conflicts and the shift back to these areas for restorations opportunities is also part of the DXY Index pattern. DXY is designated by the Dashed Black Line(—) in this chart. It should be clearly seen that DXY falls every time EEM and EFA rise which indicate capital flows are exiting the US$ for foreign markets.

Note that earlier versions of EEM showing 0.9% growth has been replaced by a MSCI reformatted EMM with less exposure to Chinese issues. This makes the long-term performance of the reformatted EMM look better at 2% but it does not change my long-term theme that the SP500 outperforms at 10% because of protections to free speech and personal property. This includes protections to intellectual property. The highly touted Chinese marketplace as a growth theme has been overstated for many years. Communist Dictatorships have never and will never be investment worthy.

In my opinion the US$ is acting as it always has. It fluctuates! There is no collapse as claimed and no one need be concerned.

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