Last night we asked whether Ben Bernanke could keep the stock market rally going after today’s FOMC meeting?
But maybe we should turn it around and ask: Can he keep the dollar plunge going?
After all, that is essentially the plan: Continue to inflate the economy by inflating the dollar.
Of course, the natural way to do this is to print more money, but the Fed doesn’t want to damage confidence and derail the market recovery. So it is a bit tricky.
Meanwhile, check out the dollar-yen exchange rate since the big revaluation. As you can see, the yen is coming off its lows already. Bernanke might like to see that trend continue. After all, why should the Japanese be the only ones to get to cheapen their currency?
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