Bob Prechter: Stocks, commodities topping; dollar set for major rally
“I think stocks are topping out, commodities are topping out and the dollar is making a bottom,” says Robert Prechter, president of Elliott Wave International and author of “Conquer the Crash“.
According to Yahoo Finance – Tech Ticker, Prechter also makes the seemingly counterintuitive argument that the dollar will rally because there’s so much debt, rather than being doomed because of it. “If the economy turns sour again in 2010, as he predicts, Prechter says the dollar will benefit as more dollar-denominated IOUs get called by creditors seeking to shore up their own balance sheets, as was the case in 2008.
“A sustained rally in the dollar would have devastating consequences for stocks, emerging-market assets, high-yield debt and commodities. But gold might be the exception, because it represents ‘real money’ and more people are questioning the global paper money system, Prechter says.”
Source: Aaron Task, Yahoo Finance – Tech Ticker, November 5, 2009.
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