Nest & Egg
Posted on April 18, 2008 at 08:47 AM EDT
So we are here in Vegas and man is it different than what we are used to. I will say that anyone who comes here should definitely drive down to the Hoover Dam (I'll pictures on the computer by tomorrow night). The dollar has taken another step down of late. One position I have had for about ten months has been exposure to the Norwegian krone via what was two year paper when I bought it (I have disclosed this position quite a few times since I put it on). When I first went in USDNOK was around 5.95, I see it printing now around 4.98 which is a huge move (the smaller the number the stronger the Norwegian). Norway is a strong country economically so that isn't so strange but Hungary, for example, has a slew of problems yet the greenback is down 8% YTD against the forint. I have never been real sure about quantifying where the dollar could go. I think it is right to be positioned for more weakness but I think the slope of the decline might be a little less going forward. I have thought that for a while but that is the sort of thing most people don't need to right about (meaning magnitude). I am warming up to the StateStreet International Inflation ETF (WIP). I bought it for a couple of new clients, I bought a few shares for my SEP and will probably integrate into more client accounts over the next few weeks. If the dollar continues lower (regardless of how quickly) WIP should do well but if the dollar goes up in a meaningful way it will be a big drag for WIP. My hope for this is that it would be a boring hold but that every few months I'll notice that its up a few percent or so. If you look at the back test for it you will see a huge move up for this but I would not bet on that repeating itself.
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