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* The dollar rallies big time! * A dollar conspiracy? * Bailing out the automakers? * Weathering the storm in N.Z.? ** The Junk Yard Dog Bites! Good day... And a Wonderful Wednesday to you! Well, the Junk Yard Dog got a hold of the euro yesterday, and even though the U.S. Banks, thus the majority of currency desks, were observing Veteran's Day, the move down in currencies VS the dollar, led by the euro, was drastic! The Junk Yard Dog I'm talking about is Jean-Claude Juncker, chairman of the Euro group... I stopped the euro in its tracks from its nascent rise in the past month, by saying the "euro's recent rise was undesirable"... He also deep sixed the euro, and thus all the currencies save yen, by saying he "didn't see any reason there couldn't be more rate cuts by the ECB"... (the ECB is of course the European Central Bank) Well... These two comments tore through any gains the currencies had mounted VS the dollar in recent weeks, like a Junk Yard Dog tears though some raw meat! It was a knife to the euro's heart......

* Dollar rally continues... * Be careful what you wish for! * Prime loans now in trouble... * Norges Bank to keep rates unchanged... ** Trade Deficit Narrows... Good day... And a Wonderful Wednesday to you! Tuesday saw more volatility in the currencies as the dollar went back in forth, but well within a trading range. The euro has melted down to the 1.49 area, where it seems to have found some breathing room. The Trade Deficit for June shrunk, but the Budget Deficit widened... Again, the fundamentals in the U.S. continue to point to recession. All this and more in today's Pfennig, so grab a cup o'java, a chair, and let's go! OK... Front and center this morning, I want to talk about the Trade Deficit, which in June showed a narrowing from $59.8 Billion to $56.8 Billion, which looks good, right? Well... As I told you in yesterday's Pfennig, you have to be careful what you wish for. This drop in the Trade Deficit pushed the dollar higher yesterday morning, and got me thinking... (I know, that could be dangerous, but stay with me here...) A stronger dollar will not play well, share toys, and keep its hands to itself, with exports... And exports have been something short of amazing with the dollar being weak. In fact, exports have accounted for the largest contribution to GDP in the past 5 quarters! (with U.S. Consumer spending drying up, this is possible!) Add to that, everyone getting goose bumps regarding a global slowdown... If the world slows down, like the dollar bulls are claiming they will, thus propping up the dollar, then U.S. exports will slow even more!...

* More bias to buy dollars... * Printing money... * Kiwi gets hit hard! * Rate announcements today......