More on labor, the deficit, and the dollar
Meanwhile, yesterday was a day of revenge for the dollar bulls. The dollar took off and gold fell after Fed Chairman Ben Bernanke said all the right things in an appearance before Congress. He talked a lot about the risk of rising deficits, and the need for fiscal and monetary restraint at some point. But if you believe that this "Helicopter Ben" Fed, the administration, and Congress will actually DO anything (rather than just TALK about these risks), you -- dear reader -- are far more optimistic and trusting than I am.
Or as Pimco Chief Investment Officer Bill Gross put it in his most recent monthly outlook this week:
"While policymakers, including the President and Treasury Secretary Geithner, assure voters and financial markets alike that such a path is unsustainable and that a return to fiscal conservatism is just around the recovery’s corner, it is hard to comprehend exactly how that more balanced rabbit can be pulled out of Washington’s hat."