Codie SanchezFounder @ Contrarian Thinking

What's Happening To The Dollar... #shorts

30 Jul 2022 · 1 min

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A short video by Codie Sanchez explaining why the US dollar is strong versus the euro and yen despite domestic concerns. She attributes dollar strength to Europe’s looming energy crisis (threats to Russian gas supplies and export restrictions), a European real-estate/mortgage stress narrative, and expectations that the US Federal Reserve will raise rates more aggressively than other central banks.

Chapters

Talk about what's going on with the dollar worth this much versus the euro and the yen. Everybody's running off to Europe for vacations. This is great because it's a strong dollar. We have more buying power around the world. But why is this happening when in the US we feel like everything's on fire right now? Well, from a context perspective, the US Is actually doing better in Europe. We have a looming energy crisis. Senor Putin has said, I'm going to shut off all of natural gas to Europe. And they're pretty reliant on it. Other countries have said, hey, we're not even going to export you firewood. So that could be an issue coming into this winter. Then, second issue at hand, we have real estate crisis. We have hundreds of billions of dollars in mortgages for people saying, nah, I'm just not going to pay. And this is just the beginning. Which is why you are going to continue to see the dollar strengthen. Because people think that the Fed are actually being pretty aggressive. They're going to raise rates maybe 1% at the next rate hike, median. Nowhere else in the world are they being that aggressive.