Dollar to Become World's `Weakest Currency,' Drop to 75 Yen, JPMorgan Says

Another way of saying this would be that JPMorgan expects the price of gold to be the strongest in U.S. dollar terms. The rewording, being equally correct, only begs further explanations. This is not an option.

It's far too late for the austerity, balanced budget, or in other words a strong dollar policy. Notice how infrequent the phrase “strong dollar policy” is spoken today. Capital knows that any serious adoption of austerity policies will bring down a world of hurt on those clamoring for it.

As I have said many times before, the flow of capital (secular trends) demand only acquiescence. Opinions, egos, or theories against their direction always fail.

The dollar may fall below 75 yen next year as it becomes the world’s “weakest currency” due to the Federal Reserve’s monetary-easing program, according to JPMorgan & Chase Co.

The U.S. central bank, along with those in Japan and Europe, will keep interest rates at record lows in 2011 as they seek to boost economic growth, said Tohru Sasaki, head of Japanese rates and foreign-exchange research at the second-largest U.S. bank by assets. U.S. policy makers may take additional easing steps following the $600 billion bond-purchase program announced this month depending on inflation and the labor market, he said.

Source: bloomberg.com