U.S. Dollar Dominates Currencies as Bulls Flock to USA

Good morning, good lookin'... the two things you need to know on January 3rd are:

Jan 3, 2014 at 6:00AM
First days can be awkward. After Wall Street took the holiday off, the Dow (DJINDICES:^DJI) dropped 135 points Thursday to start the new year. The blue chip index rose 27% during 2013 for its best year since '95, so it probably earned a little rest.
1. U.S. Dollar is star of global markets on 2014 debut 
America is the popular choice for where to park money in 2014. China's growth is corrupt and slowing, and Europe's still dragging in its debt crisis. But America actually grew 4.1% in the third quarter, and econ data is solid. Investors bought loads of U.S. government debt Thursday, reducing the 10-year interest rate America borrows at to 2.99%. You need U.S. Dollars (USD) to buy U.S. bonds, so the USD rose on the demand. Our USD broke the new year's resolution mold -- it's pledging to gain weight this year.

What's better, the USD or the euro? The only way to measure the value of a currency is by comparing it to another. And Thursday, the dollar pounded its euro friend like in one of the world wars. The euro dropped 0.6% in value compared to the dollar, to $1.36 (that's how much it costs to buy one euro right now. On Tuesday it was $1.38). A $0.02 drop in value doesn't seem like much (although it used to buy a tootsie roll), but so much crap is valued in either euro or USD, that the implications of the change is freaking massive.  

A strong USD isn't as nice for America as you'd think. In fact, the Godfather of the economy, Ben Bernanke, would probably prefer a weak dollar. Cheap dollars means that our stuff is cheaper for foreigners to buy, which is good for the economy because we export more abroad. The strong dollar is a sign of a strengthening America in the global economy, but Uncle Sam would prefer a strengthening protein shake instead.
2. U.S. Manufacturing ends 2013 on a high note
According to the Institute of Supply Management (ISM), manufacturing activity in the U.S. increased in December at its second fastest pace since April 2011 -- cha-ching. Investors are big fans of the research firm's all-inclusive monthly report on the industry, which makes up 12% of U.S. Gross Domestic Product.
Manufacturing is fun, but what was the highlight? Factory orders. In the automobile industry, in particular, rising sales have pushed major manufacturers like General Motors (NYSE:GM) and Ford Motor Co. (NYSE:F) to add more workers than Santa up north.

The takeaway is that America's manufacturing recovery looks even hotter compared to the rest of planet Earth. Other international manufacturing reports released Thursday showed the industry slowing down a tad in the U.K., with manufacturing in France and China falling to end 2013 on a more depressing note than a Miley Cyrus New Year's Eve special.

  • Motor Vehicle Sales
  • Three Fed Presidents and Chairman Ben Bernanke have big speeches

As originally published on MarketSnacks.com

Fool contributors Jack Kramer and Nick Martell have no position in any stocks mentioned. The Motley Fool recommends Ford and General Motors. The Motley Fool owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

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This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

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KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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