Fed cut -- the day after

Lots of talk this morning about what the Fed cut does or doesn't mean, for the near and long term. Me? I can't help but continue to watch the absolute train wreck in the currency markets. The Dollar Index was recently down ANOTHER 208 basis points to about 78.57. This is a move of about 2.6% after a 1.9% drop yesterday and a 1.6% drop the day before. The DXY is down in seven of the past eight days. Everything from the yen to the Hungarian forint is rallying against the buck.

I don't know at what point the move becomes "disorderly" -- something currency traders and central bankers hate to see. And I still see NO evidence this is impacting the bond market. In fact, long bond futures are up another 2 25/32 as I write. Mortgage bonds are rallying as well, driving mortgage rates lower. But you just have to wonder how much longer foreign creditors will just "grin and bear it." We're not a surplus nation like Japan was when it embarked on its ZIRP policy. We're a debtor country that relies on foreign inflows to sustain itself. I just hope Ben Bernanke's good luck continues -- for all of our sakes.