Economic Outlook: A Change of Seasons

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PHOTO: FOTOLIA/TINO NEITZ
The surest sign of continuing dollar strength is the professed determination of major Western governments to keep the dollar down.

A Change of Seasons

It’s been quite a long time since we’ve been able to offer arty rays of hope in this column. However, as anyone who’s seen a television stews program or read a paper or magazine in the past few months certainly knows, the United States has clearly experienced art economic recovery of sorts. The reasons for this turnaround are marry and varied (and include happenings on the internal and external political fronts as well as more specific economic actions arid its endurance is open to speculation. Still, it does offer each of us a number of opportunities that were nowhere to be found a few short months ago . . . and the manner in which we take advantage of those offerings may well determine how we all, as individuals and as families, fare in the years to come. However, before we carry that particular thought arty further, let’s take advantage of the expertise of some very wise individuals . . . by — oncemore — gleaning the views presented by a group of respected writers from the exclusive economic newsletter industry.

“My gut feeling (for what it’s worth) is that this is not the beginning of a bear market. My guess is that we are in a secondary correction of undeterminable severity, and that when the correction has run its course the market will head up again toward and then over the highs. But that will take time. Remember, this market has been climbing skyward for eleven straight months without anything like a worthwhile correction. And the market is tired. But to say that it’s all over is something else again. The odds are always against a change in the primary trend, and my feeling is that this is not the time to get hysterical. One can be cautious here — but nothing has been proved yet.”

Richard Russell’s Dow Theory Letters, Inc., August 10, 1983 (26 issues per year for $225, Dept. TMEN, P.O. Box 1759, La Jolla, California 92038)

“The surest sign of continuing dollar strength is the professed determination of major Western governments to keep the dollar down. Last week, with carefully arranged publicity, the central banks of the U.S., Japan, Germany, Switzerland, and France sold perhaps $2 billion for yen, German marks, Swiss francs, and French francs in a concerted effort to take some of the steam out of the dollar’s rise. After a brief sell off, the dollar rapidly rebounded to a 9 1/2 year high of above 2.68 German marks, and to above 2.17 Swiss francs and 244 yen.”

  • Published on Nov 1, 1983
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