Low Oil Prices Inspire Confidence

New York stock markets showed positive gains as the lowest oil prices in more than a year inspired investor confidence. The Dow rose 240 points having been down as much as 380 points in the late morning. Stocks were down in morning trading as investors responded to a pair of weak manufacturing reports, Merrill Lynch and Citigroup’s losses and the decline in oil prices. Oil prices continued to decline after the government’s weekly inventory report showed a larger than expected gain in crude and gas supplies. Perceptions of slowing demand have sent oil prices lower than the all time high of July, 11^th.

Fear of Recession Looms

The decline is seen by many as another indication of a global economic slowdown. Despite recent good news there is still a fear of a global recession with some saying the US has already entered a recession. Many analysts say that market volatility is here to stay. Said Gary Flam, portfolio manager, Bel Air Investment Advisors, “To a certain extent, we’re in the middle of a hurricane, “It will pass eventually and we will get through it, but there’s been a lot of damage.” Credit markets remain frozen affecting interbank Forex markets.

Factory Production Lowest in 34 Years

While investors have welcomed recent government actions the negative tone of markets reflect the fact that the effect of many programs will take months to be felt. Recession fears sent stocks plunging Wednesday with the Dow falling 733 points making the session the second worst ever on a point basis. Adding to the bad news the Federal Reserve announced that factory production fell by the largest amount in nearly 34 years. The fall was blamed on the effect of hurricanes Ike and Gustav had on Gulf coast industry. The Philadelphia Fed index, a regional reading on manufacturing fell to an 18 year low. The Index had an original prediction of a decline of negative 5 while the actual figure was a whopping negative 37.5 far exceeding the original forecast. Despite the negative economic indicators the US dollar is still holding it’s own on interbank Forex markets.

TED Spread Hits Record

Lending rates improved slightly with the overnight lending rate falling to 1.94% down from 2.14% late Wednesday. The 3 month LIBOR fell to 4.50% down from 4.55%. The TED spread which is the difference between what banks pay to borrow from each other for three months and what the Treasury pays narrowed to 4.11% from 4.31%. The spread hit a record 4.65% Friday and the wider the spread the more reluctant banks are to lend to each other. This is certainly not good news for credit markets or interbank Forex markets.

Interbank Forex and Lending

Although the performance of markets this week has been hopeful the long term does not look positive. Negative economic indicators and recession fears are looming in the background and psychology plays a big part in market performance. The positive effects of many bailout programs will take months to be felt and investors are sure to be in for a wild ride. Interbank Forex lending is important for Forex traders and markets. Fortunately for Forex investors’ currency does not fluctuate as wildly as stocks and securities and many Forex investors have made impressive gains despite the global economic crisis.

Nationalization Unthinkable

The US prides itself in being one of the last bastions of free enterprise and unfettered capitalism. Until recently the idea of nationalizing banks would have been unthinkable and would be political suicide for any politician advocating nationalization. The recent mortgage meltdown and the ensuing financial crisis have caused even the Bush administration to consider a partial nationalization of several embattled US banks. The partial nationalization of banks is not expected to affect interbank Forex transactions.

The Unthinkable Becomes Reality

After six straight disastrous days of trading stocks gained slightly after an early report that Treasury Secretary Paulson is considering allowing the Treasury Department to take ownership stakes in several beleaguered banks. The banking and credit crisis has surpassed all other economic considerations and the situation became even more serious Wednesday when despite a coordinated rate cut by US and European central banks global markets still experienced losses. Thursday morning (October 9^th) the New York Times cited unnamed Treasury officials who stated that the recently passed $700 billion dollar bailout bill allows the Treasury to put cash directly into the banking system.

It is hoped that the direct injections of cash will persuade banks to continue lending while strengthening the banks balance sheets. The Treasury would also have the right to take ownership positions in the troubled banks. At present the Treasury’s plan is unclear and without details on how the plan would work. It is expected that the plan would be voluntary for banks. Moves by both the Treasury and the Federal Reserve have strengthened the US dollar on interbank Forex markets.

Paulson Speaks

The Fed has already injected billions into all but frozen credit markets and will buy commercial paper that corporations issue to obtain short term loans and cover day to day expenses. In a statement Secretary Paulson said, “Uncertainty and a lack of confidence have clogged our basic financial plumbing. While our actions have been aimed at restoring financial markets and institutions, our purpose is to prevent financial market difficulties from further impacting businesses and families across the country.”

US Dollar Strong Despite Crisis

The current global financial crisis has made the unthinkable a reality. The fact that a conservative administration such as the present one would consider even partial nationalization of any industry reflects the seriousness of the current global situation. It remains to be seen what effect this partial nationalization of the US banking system will have on the US dollar on interbank Forex markets. The dollar has been holding its own against other world currencies despite the global financial crisis. Latest reports have the dollar rising against the Euro. Despite the dismal US economy the dollar is still seen as a relatively safe haven by Interbank Forex traders.

Fed Established By Congress

The US Federal Reserve has been in the news frequently for the last two months but there are many who have no idea just what the Federal Reserve does and what function it serves. Established by Congress in 1913, the Federal Reserve was designed to present the country with a more secure, more elastic, and more stable economic and financial structure. The Federal Reserve is also in charge of monetary policy and the management of banks. Probably the most important function of the Federal Reserve is to regulate the money supply so as to keep production, prices, and employment stable.

Fed Monitors the Economy

The economy is always best when it is growing. People have jobs, businesses are able to produce and the quality of life for the average citizen is better. When the economy is not growing the opposite takes place. Unemployment, a lack of productivity, and a lower standard of living are the sign of a downturn in the economy. The Federal Reserve has been entrusted by Congress to take measures to insure stability and to control inflation and interest rates. The actions of the Federal Reserve have profound effects on global interbank forex markets.

Setting Stable Interest Rates

Both business owners and consumers are concerned about interest rate stability. The US is a credit oriented society and stable interest rates are essential for the national economy to function. Without stable interest rates businesses and consumers find it difficult to plan for the future. The Federal Reserve sets basic bank lending rates and banks pass on any increase or decrease in rates to consumers. The rates set by the Federal Reserve also affect interbank forex lending.

Monitoring the Financial Sector

Maintaining the overall stability of the financial system is one of the top priorities of the Federal Reserve. A stable financial system allows businesses and students to get loans, and consumers to purchase goods and services. When the integrity of the financial system is threatened the Federal Reserve can institute corrective policies. Recently the Federal Reserve pumped billions into the banking system to rescue ailing banks and to ensure the availability of credit on both domestic markets and interbank Forex.

Maintaining A Strong Dollar

The US dollar is the world’s reserve currency and the Federal Reserve is charged with ensuring the stability of the US dollar. A strong dollar is essential for the US economy. Despite the near collapse of the US banking system and negative economic indicators the US dollar remains strong. A strong dollar will significantly contribute to economic recovery in the US and monetary policies set by the Federal Reserve are designed to have that effect.

The Fed and the Bailout

The Federal Reserve has been under immense pressure recently from congress and the public. Testimony before congress by Federal Reserve officials convinced many in congress to vote for the politically unpopular $700 billion dollar bailout bill. After weeks of uncertainty the effects of the bailout are starting to be felt by the financial sector. The dollar is doing well on Forex markets against most currencies except the Japanese Yen. Investors are turning to both the Dollar and the Yen for risk aversion.

In today’s global economy any action by the Federal Reserve can have global repercussions. In this time of volatile markets one can only hope the Federal Reserve continues to make the right decisions. The actions of the Federal Reserve could well affect interbank Forex markets well into the future.

Greenspan Before Congress

In a statement to the House Oversight Committee former Federal Reserve Chairman Alan Greenspan stated that the current financial crisis is a “once-in-a-century credit tsunami” which will have a severe economic impact on the nation’s economy and will drive unemployment higher. Greenspan also stated that the current financial crisis had “turned out to be much broader than anything that I could have imagined.” The current economic meltdown has affected interbank Forex markets and the rates charged for interbank lending.

Greenspan, John Snow, and Christopher Cox Testify

Greenspan was called to testify by the committee along with former Treasury Secretary John Snow and Securities and Exchange Commission Chairman Christopher Cox. Committee chairman Henry Waxman (D-Calif.) said that the Federal Reserve, the Securities Exchange Commission, and the Treasury Department had all contributed to the current financial crisis. In a strongly worded statement Waxman said, “The list of mistakes is long and the cost to taxpayers is staggering, our regulators became enablers rather than enforcers. Their trust in the wisdom of the markets was infinite. The mantra became that government regulation is wrong. The market is “infallible.”

Greenspan Places Blame on Subprime Mortgages

In his testimony before the committee Greenspan blamed the crisis on heavy demand for securities backed by subprime mortgages by investors who never thought that the housing market would crash. Greenspan said that for the crisis to end stabilization in home prices is necessary and that it would take many months for this to happen. Greenspan gloomily predicted, “Given the financial damage to date, I cannot see how we can avoid a significant rise in layoffs and unemployment. Fearful American households are attempting to adjust, as best they can, to a rapid contraction in credit availability, threats to retirement funds and increased job insecurity.”

Greenspan and Bush Administration Criticized

Greenspan predicted that when home prices stabilize the credit markets should begin to thaw and renew investor confidence. Greenspan also said that government is correct to aggressively proceed with efforts to support the financial sector of the economy and also thought that the $700 billion dollar bailout is adequate to move markets forward. Some blame Greenspan and the Bush administration for ignoring warning signs and stubbornly believing that the market is always right and regulation is not an appropriate government function. Greenspan served during a period of relative stability and interbank forex markets were profoundly affected by the actions of the Federal Reserve.

Greenspan placed the blame for the current crisis on over eager investors who did not worry that the boom in home prices might come to a crashing halt. Greenspan’s critics believe that earlier in the decade he left interest rates too low spurring an unsustainable housing boom. The hearing got contentious as lawmakers who are already angry about having to vote for the politically unpopular bailout bill searched for answers to what went wrong. Holding hearings close to an election is unusual but chairman Waxman said the crisis was so serious that Congress could not wait until a new administration arrives in January to find out “what went wrong and who should be held accountable.”

Recession, the US Dollar and Interbank Forex

On Forex markets the US dollar has been doing surprisingly well but many analysts believe that if the US enters a recession all bets are off for the dollar. Of course savvy Forex investors and traders will be watching the US economy closely for any signs of trouble and will invest accordingly. The Forex markets will remain the largest in the world and will continue to offer alert investors plenty of opportunities. The actions of the Fed could affect interbank Forex exchanges well into the future.

USD Currency of Choice

While the performance of the US dollar has baffled some experts the question remains: how long will this strong performance in currency markets last? At present, the US dollar seems to be the currency of choice despite the negative performance of the US economy. The fundamentals of the US economy are deteriorating, housing markets, stock markets, productivity, the recent collapse of several venerable Wall Street firms, and a lack of investor and consumer confidence all spell trouble in the near future. At present there are several factors that contribute to the dollar’s success. The dollar at present is the world’s reserve currency and is essential to the performance of interbank Forex markets.

Fast Action By US Government Calms Investors

The quick reaction of the US government and its institutions and the cooperation between the two major parties had a calming effect on investors and probably prevented a total market collapse. In the United States the problems are transparent and the willingness of government to try several approaches to reach a solution may inspire confidence in some. Credit markets remain a concern and most realize that it will be quite some time before the effect of the $700 billion dollar bailout will be felt. The infusion of cash has been slow to affect interbank Forex markets.

European Economy Deteriorates

The European economy is deteriorating rapidly despite the efforts of central banks to stimulate liquidity in credit markets. The UK is experiencing its own mortgage meltdown complete with collapsing banks and lowered real estate values. Many European financial institutions invested heavily in mortgage backed securities which are now worth a fraction of their original value. The French and German economies are experiencing accelerated economic slowdowns. Despite the actions of the central banks and governments credit markets remain frozen to the detriment of the European economy and has severely affected interbank Forex exchanges. The Euro has been declining against the US dollar.

Fallout Affects Asia

The fallout from the American economic crisis has affected Asian markets and economies. In Singapore, economists are predicting a downturn lasting several quarters and China is experiencing a significant slowdown. The declining demand for commodities has adversely affected both the Australian and Canadian dollars. The Japanese economy is expected to be affected by the crisis in the US. Japanese automakers expect to see a decline in US sales, the US being the largest market for Japanese automobiles.

Forex Markets

In the short term the economic troubles in the US are actually helping the dollar to retain its value. Whether the US enters a recession will determine the future of the US dollar in the medium and long term. At present the dollar continues to offer opportunities in Forex markets although it remains a mystery just how long it will last. The dollar continues to be the currency of choice on interbank Forex markets.

Markets Show Temporary Gains

New York stock markets showed positive gains as the lowest oil prices in more than a year inspired investor confidence. The Dow rose 240 points having been down as much as 380 points in the late morning. Stocks were down in morning trading as investors responded to a pair of weak manufacturing reports, Merrill Lynch and Citigroup’s losses and the decline in oil prices. Oil prices continued to decline after the government’s weekly inventory report showed a larger than expected gain in crude and gas supplies. Perceptions of slowing demand have sent oil prices lower than the all time high of July, 11^th.

Global Recession Fears

The decline is seen by many as another indication of a global economic slowdown. Despite recent good news there is still a fear of a global recession with some saying the US has already entered a recession. Many analysts say that market volatility is here to stay. Said Gary Flam, portfolio manager, Bel Air Investment Advisors, “To a certain extent, we’re in the middle of a hurricane, “It will pass eventually and we will get through it, but there’s been a lot of damage.”

Factory Production at Lowest in 34 Years

While investors have welcomed recent government actions the negative tone of markets reflect the fact that the effect of many programs will take months to be felt. Recession fears sent stocks plunging Wednesday with the Dow falling 733 points making the session the second worst ever on a point basis. Adding to the bad news the Federal Reserve announced that factory production fell by the largest amount in nearly 34 years. The fall was blamed on the effect of hurricanes Ike and Gustav had on Gulf coast industry. The Philadelphia Fed index, a regional reading on manufacturing fell to an 18 year low. The Index had an original prediction of a decline of negative 5 while the actual figure was a whopping negative 37.5 far exceeding the original forecast. The performance of the US dollar has been positive for the most part and is still the currency of choice in interbank Forex markets globally.

Bad News For Credit Markets

Lending rates improved slightly with the overnight lending rate falling to 1.94% down from 2.14% late Wednesday. The 3 month LIBOR fell to 4.50% down from 4.55%. The TED spread which is the difference between what banks pay to borrow from each other for three months and what the Treasury pays narrowed to 4.11% from 4.31%. The spread hit a record 4.65% Friday and the wider the spread the more reluctant banks are to lend to each other. This is certainly not good news for credit markets or interbank Forex markets.

Markets Affect Interbank Forex

Although the performance of markets this week has been hopeful the long term does not look positive. Negative economic indicators and recession fears are looming in the background and psychology plays a big part in market performance. The positive effects of many bailout programs will take months to be felt and investors are sure to be in for a wild ride. Interbank Forex lending is important for Forex traders and markets. Fortunately for Forex investors’ currency does not fluctuate as wildly as stocks and securities and many Forex investors have made impressive gains despite the global economic crisis.

US Faces Debt and Job Losses

In addition to the recent financial and banking crisis in the US the country faces unprecedented debt and massive job losses. The US economy has been shedding jobs at an alarming rate. Because of losses in the stock markets many have seen their retirement savings dissipate and their children’s college funds shrink to a fraction of their former value. The fact that the US faces a presidential election only adds to the uncertainty felt by millions. Interbank Forex markets have been slow to react to the massive US bailout package and credit markets remain frozen.

Economy Bad News For Incumbents

For the incumbent administration and members of their party bad news is simply bad news. For the challengers bad news is good news and recently there has been no shortage of bad news. Historically during economic downturns US voters have traditionally punished the incumbents blaming them for current economic conditions.

Lack Of Confidence in the Economy

Despite the $700 billion dollar bailout and the $250 billion dollar plan to recapitalize banks many are not confident that the economy will fully recover. Unemployment is still only 6.1%, but everyone expects it to rise. Some economists feel the US is entering a recession and many voters feel it has already entered a recession. Massive home foreclosures, slumping house prices, massive job losses have most voters on edge. Recent actions by the Fed have contributed greatly to the strong performance of the dollar on interbank Forex markets and is still the currency of choice for risk adverse investors.

Economy Good News For Challengers

Few voters truly understand why the economy is in crisis but many blame the Bush administration. John McCain although a competent candidate is saddled with being from the same party as Bush and many voters see his candidacy as a continuation of the policies of the last eight years. Mr. Obama, due to the fact that his party does not occupy the current white house has a hefty advantage among the disgruntled. Barring a sudden economic turnaround, Mr. Obama’s prospects look good.

The candidates differ on economic issues with McCain sticking to relatively conservative positions and Obama promising tax reform and many social programs. Obama’s tax cuts would favor the middle class while McCain’s tax policies would be a continuation of the Bush policies. McCain favors corporate tax cuts in an attempt to stimulate business growth but opponents characterize these as ‘tax cuts for the wealthy.’ The truth probably lies somewhere in between.

Problems Unprecedented

No matter which candidate wins the election, he will face economic problems of historic proportions. On Wednesday, the International Monetary Fund — a cornerstone of the Breton Woods system — warned that the world economy faces “the most dangerous financial shock in mature markets since the 1930s.” Obama must offer voters a coherent plan for the economy if he expects to win in November. The problem is no one really knows what to do about current economic conditions, not Obama, not McCain, not Ben Bernanke or Paul Krugman or Larry Summers or Hank Paulson. The country is facing problems for which there are no clear solutions.

US Dollar and Economy at Stake

A lot can happen between now and November and it will be January when the new administration actually takes office. The future of the US economy and its currency are at stake. At present the US dollar is holding its own in interbankForex markets and the recent rise of the Euro is seen as an indicator that the global bailout is starting to work. The US faces unprecedented economic challenges and whoever wins in November will face challenges not faced by a US president since Franklin D. Roosevelt took office in 1933.

World Financial Leaders Meet

Last week’s meeting of the International Monetary Fund (IMF) was attended by the world’s financial leaders who are putting aside political differences in order to stave off a global recession. Instead of the bickering that usually takes place at IMF meetings, attendees were desperately seeking solutions to the worse financial crisis in recent history. The crisis has affected all markets including the interbank Forex.

IMF Promises to Take Decisive Action

The IMF’s steering committee said Saturday that all 185 member nations are committed to do whatever it takes to support the financial system, including a promise to “take decisive action and use all available tools to support systemically important financial institutions and prevent their failure.” The IMF statement mirrored commitments made by finance ministers and central bankers from the seven wealthiest industrialized countries. Following the IMF meeting economic leaders from a group of wealthy and developing countries pledged to intensify efforts to unfreeze credit markets and jump start interbank Forex exchanges.

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Crisis Years in the Making

The current financial crisis has been years in the making and the crisis is the product of years of reckless and irresponsible behavior by both government and financial institutions. Warning signs were clearly present in 2007 when the subprime mortgage ‘bubble’ burst. Throughout 2007 several major mortgage companies filed for Chapter 11 Bankruptcy and several venerable Wall Street firms found themselves in financial difficulty. Credit markets froze and interbank forex lending all but ceased.

Troubled Housing Market

The troubled housing market sent warning signs to Washington and ^] Both Fed chairman Ben Bernanke and Treasury Secretary Hank Paulson expressed alarm about the dangers posed by the bursting housing bubble. Paulson stated, “The housing decline is still unfolding and I view it as the most significant risk to our economy. … The longer housing prices remain stagnant or fall, the greater the penalty to our future economic growth.”

The Crisis Escalates

Fast forward to 2008 and the crisis rapidly escalates. In March Bear Sterns, one of the oldest firms on Wall Street gets federal funding as shares plummet. Bear Sterns was acquired by JP Morgan Chase for $2 a share. In September rapidly deteriorating conditions prompt the Federal Government to take over Fannie Mae and Freddie Mac which at that point owned or guaranteed about half of the U.S.’s $12 trillion mortgage market. In mid September the crisis spiraled out of control with catastrophic events occurring daily.

Lehman Brothers and AIG Fail

On Sept. 14^th Merrill Lynch was sold to the Bank of America, and the next day Lehman Brothers filed for bankruptcy. On Sept. 16th Moody’s and Standard and Poor’s downgraded ratings on insurance giant AIG’s credit on concerns over continuing losses to mortgage-backed securities. The next day the Federal Reserve loans AIG $85 billion dollars to help the firm avoid bankruptcy.

Paulson Announces Bailout Plan

After a dismal week for markets Treasury Secretary Paulson unveiled his plan for a bailout. The plan was put to a vote in the House and failed 228 to 205. On October 1^st the Senate passes a revised bailout bill laden with tax breaks for special interests. On Oct. 3^rd the House passed the revised bill and President Bush sign the bill into law. It is expected to take some time before the effects of the bailout package are felt by credit and interbank forex markets.

Conditions continue to deteriorate and on Oct. 6^th the London market declines by 8% the largest fall in 20 years. Other European markets fell by a similar amount. On Oct. 6^th several other countries take drastic action to prevent financial collapse and unfreeze credit markets.

Credit Markets Frozen

The short-term lending market had frozen, and companies began to worry that they would not be able to get the loans necessary to pay their bills or make payroll. On Oct. 8^th Central Banks in Europe and the Federal Reserve announced coordinated rate cuts of half a percentage point. Despite early optimism the coordinated move did little to boost investor confidence and markets continued their decline. On Oct. 9^th the Treasury Department announced it was seeking equity stakes in some of the country’s banks, in order to inject capital directly into the troubled financial system. This move would partially nationalize banks, something that was unthinkable in the United States. The actions of the Federal Reserve affect all aspects of the world economy including the interbank Forex market. Despite the crisis the US dollar remains the currency of choice on interbank Forex exchanges globally.

Despite Action Markets Down

Despite drastic action by governments, credit markets were still frozen and the effects of the crisis started to creep into the day to day economy. Probably the most stunning news was that General Motors was considering bankruptcy. The already troubled US auto makers depend on consumer credit accessibility and frozen credit markets could spell doom for the auto industry.

Interbank Forex Markets Steady

The only good financial news in these troubled times is the fact that the US dollar continues to hold its value on interbank Forex markets and Forex trading. The dollar continues to hold steady against most world currencies and has gained against the troubled Euro. It would appear that Forex investors and traders are the only ones making any money in these troubled times.

AIG Executives Hold Bailout Party

In an astonishing display of hubris, executives at insurance AIG headed to a $440.000 retreat at one of the nations most luxurious resorts. The retreat was held less than a week after the Federal Government offered an $85 billion dollar bailout to the insurance giant. Executives had no qualms about tapping into the $85 billion dollar loan sending executives to the St. Regis resort south of Los Angeles. Executives received royal treatment including golf and $28,380 worth of spa treatments. Angered congressmen expressed outrage at the frivolous spending of taxpayer dollars meant to shore up the troubled company’s finances. Because of the irresponsible actions of executives like the ones at Lehman Brothers world markets are in turmoil and interbank forex markets have been impacted.

Congress Outraged

Democrat Henry Waxman expressed the feelings of many when he said in an opening statement, “Average Americans are suffering economically. They’re losing their jobs, their homes and their health insurance. Yet less than one week after the taxpayers rescued AIG, company executives could be found wining and dining at one of the most exclusive resorts in the nation.”

Lehman Brothers CEO Defends Compensation Package

In another amazing display of arrogance the CEO of the recently bankrupt Lehman Brothers investment bank defended executive pay of himself and other executives responsible for Lehman Brother’s woes. Former Lehman Bros. CEO Richard Fuld attempted unsuccessfully to defend the $484 million he has received in salary, bonuses and stock options. In an attempt to shed blame Fuld blamed the failure of Lehman Brothers on short selling and market ‘manipulation’ and conceded no errors in judgment.

$20 Million in ‘Special Payments’ to Execs

The congressional hearings finally put a face-Fuld’s- on their outrage at corporate CEO’s who took home millions while betting on risky mortgage backed investments that brought the world’s financial markets to a grinding halt. Internal company documents and emails revealed that despite financial troubles executives “continued to squander millions on executive compensation” in the words of California Representative Henry Waxman. Waxman also cited another company document that showed that four days before filing for bankruptcy, the compensation committee recommended that three departing executives receive more than $20 million dollars in ‘special payments.’

Fuld also nixed a suggestion from Neuberger Berman, the company’s money management subsidiary, that Lehman management should forgo yearly bonuses. The suggestion was designed to “send a strong message to both employees and investors that management is not shirking accountability for recent performance.” In a time when many Americans are losing their homes to foreclosure congress was less than receptive to excuses given by executives who received millions for poor performance.

Forex Market Still Performing

Because of executives like Fuld, world credit markets, stock markets, Interbank Forex, and financial institutions are currently in dire straits. The bailout remains politically unpopular in the US and investigations by congress are bound to reveal sordid financial dealings by executives of failed financial institutions. The only markets that have produced any positive results have been retail and interbank Forex markets where the dollar is trading high against several currencies including the Euro. The Euro is currently at a 14 month low against the dollar. At present it would seem that Forex markets are the only place where investors can hope to come out on top.