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Goldman Slams USD... Again

Tyler Durden's picture




 

It has been a few weeks since Goldman's FX strategist Tom Stolper made a public appearance. Which is reasonable: after all the EURUSD dipped as low as 1.39 about ten days ago, a level which threatened to stop out Stolper's 1.55 EURUSD target at a loss. Luckily for the GS FX strategist, this is about the time when the G7 decided it was its imperative to once again impair Europe in exchange for sending US stocks higher (i.e., DXY down, RUT up), alas the decision came at a very bad time for the US economy, which was just entering the worst 10 day period of declining growth since last summer. Either way, now that the EURUSD has retraced a massive 630 pips move in the past 10 days, Stolper has once again shown his head, issuing yet another hit piece on the USD. And what a hit piece it is: "...he upcoming balance of payment data will likely show a notable
deterioration in the BBoP. Finally, US policymakers seem to be making
little or no progress on fiscal consolidation with Moody’s now also
warning about the consequences of hitting the debt ceiling in early
August
. We remain short the USD against the EUR, CNY, MYR, PHP, and now also the NOK." Ok, we get how you feel... But what is the prop desk doing?

Just out Goldman Sachs:

Dollar Drifting Down. It’s been a few choppy weeks for Dollar bears, but our conviction in the underlying trend remains unchanged. A host of reasons led to a temporary recovery in the Dollar and we would have liked to be nimble enough to avoid the roller coaster. At one stage we had briefly given back all previous gains on our long EUR/$ recommendation. But things look much better for Dollar bears again. Our EUR/$ long is now in the black by about 3.7% and we used the recent Dollar bounce to initiate a short USD/NOK Top Trade for 2011. We also revised our forecasts in the latest FX Monthly to show a continued USD down trend, now projecting EUR/$ to trade at 1.55 in 12 months time. The reasons for the Dollar decline remain the same. Structural imbalances and weakness in the US manufacturing sector result in easier monetary policy in the US than elsewhere. Moreover, the same structural problems keep the trade deficit wide and reduce the attractiveness of investments in the US as highlighted by weakness in capital inflows. The upcoming balance of payment data will likely show a notable deterioration in the BBoP. Finally, US policymakers seem to be making little or no progress on fiscal consolidation with Moody’s now also warning about the consequences of hitting the debt ceiling in early August. We remain short the USD against the EUR, CNY, MYR, PHP, and now also the NOK.

 

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Fri, 06/03/2011 - 15:03 | 1337059 Caviar Emptor
Caviar Emptor's picture

Slumping into the long, hot summer.

Sometimes, you just can't catch a break. 

Everything smelled like roses just a couple of months ago. Now everything smells like garbage.

Fri, 06/03/2011 - 16:00 | 1337358 IdioTsincracY
Fri, 06/03/2011 - 16:20 | 1337437 trav7777
trav7777's picture

so, wait...the debt ceiling isn't till August now???

Fri, 06/03/2011 - 15:04 | 1337063 SparkyvonBellagio
SparkyvonBellagio's picture

GS has been very USA negative recently, because they know they U.S. GOVT is going to give up protecting them.

 

They're going down I feel.

Quicker than a Client #9 ho.

Fri, 06/03/2011 - 15:02 | 1337072 slow_roast
slow_roast's picture

Good point.  The frightening thing is that Goldman has more power and ability to influence the Fed and economic outlook than any government institution.

Fri, 06/03/2011 - 15:31 | 1337193 Arius
Arius's picture

yep - be afraid of a cornered rat...

Fri, 06/03/2011 - 15:52 | 1337324 SparkyvonBellagio
SparkyvonBellagio's picture

I hope a rat gnaws bankinfines knee caps off.

Then tried and true Americans pour salt and sulphur in it's wounds.

 

Fri, 06/03/2011 - 19:24 | 1337987 rocker
rocker's picture

+10   That a new one, 'bankinfines'.  That's so fukn funny.  LMAO

Fri, 06/03/2011 - 16:22 | 1337442 trav7777
trav7777's picture

the USG is also such a rat, and it is far larger and hungrier than GS

Sometimes the confettiers don't win

Fri, 06/03/2011 - 16:47 | 1337515 NumberNone
NumberNone's picture

GS Loses (wink-wink) $1.3 Billion of Libya's Sovereign Wealth Fund...sure they did.  Who had the other side of the bets?  Any guesses anyone?

Amazing that GS loses a billion of Libya's money, gets threatened by Libya, GS makes promises to make Libya whole, but before the deal can be completed war breaks out with Libya...suddenly it's "Fuck You Libya, come get your money". 

http://blogs.forbes.com/afontevecchia/2011/05/31/goldman-sachs-lost-98-of-libyas-1-3b-sovereign-wealth-fund-investment/

Tie this bullshit to Blair-Rothschilds friendship, et al... suddenly Gaddafi looks like a marked man that pissed off the wrong money people.  Time to collect. 

http://blogs.telegraph.co.uk/news/davidhughes/100077033/labours-sickening-smarming-up-to-gaddafi-and-family/

 

Sat, 06/04/2011 - 07:58 | 1338988 BigDuke6
BigDuke6's picture

Yes.  The whole grubby story is here - goldman giving backhanders to despot family members.

They are bad people.

http://professional.wsj.com/article/SB1000142405270230406650457634719053...

Fri, 06/03/2011 - 15:01 | 1337067 slow_roast
slow_roast's picture

Soon traders will receive account credits for opening ES positions.  CME

Fri, 06/03/2011 - 15:05 | 1337068 PaperBear
PaperBear's picture

Is this transitory too ?

Fri, 06/03/2011 - 15:03 | 1337075 lizzy36
lizzy36's picture

Rumor has it that Goldman was size buyer this morning around Euro 1.4480 level.

Odd that they would come out with this note this afternoon.............

Fri, 06/03/2011 - 15:08 | 1337080 Caviar Emptor
Caviar Emptor's picture

Really?

Fri, 06/03/2011 - 15:17 | 1337120 dracos_ghost
dracos_ghost's picture

Probably have inside info regarding the Greeks acceptance of EU/IMF terms over the weekend.

Fri, 06/03/2011 - 16:20 | 1337446 trav7777
trav7777's picture

amazing is how ECB's QE seems to be euro-positive.  Perhaps there is something lurking beneath the bushes on this

Fri, 06/03/2011 - 15:07 | 1337076 AldoHux_IV
AldoHux_IV's picture

Ok we get how you feel... but what is the prop desk doing?

Dig it.

 

Fri, 06/03/2011 - 15:08 | 1337077 carbonmutant
carbonmutant's picture

Are they buying...?

Fri, 06/03/2011 - 15:08 | 1337084 Alcoholic Nativ...
Alcoholic Native American's picture

Where exactly is the GS headquarters?

 

edit: N/M, it's in new york.

Fri, 06/03/2011 - 15:13 | 1337094 Franken_Stein
Franken_Stein's picture

 

200 West Street, downtown Manhattan, New York, New York, USA

 

World Financial Center / World Trade Center (Ground Zero)

 

Fri, 06/03/2011 - 15:14 | 1337119 Alcoholic Nativ...
Alcoholic Native American's picture

Yea, I just looked it up, I was thinking it was in Tel Aviv for some reason.

Fri, 06/03/2011 - 15:20 | 1337143 Shell Game
Shell Game's picture

On the south shore of the river Styx.

Fri, 06/03/2011 - 15:09 | 1337087 Bob
Bob's picture

Pure feeling, and nothing but.  Too much money sloshing around in a too criminal enterprise . . . we shouldn't even be having this discussion. 

Fri, 06/03/2011 - 15:07 | 1337089 PaperBear
PaperBear's picture

GS execs going to trial for the CDS fraud in a Greek court and in a court in the USA.

If any execs get convicted in both Greece and the USA then I am all for chopping them in half so they can go to jail twice.

Fri, 06/03/2011 - 15:13 | 1337112 Franken_Stein
Franken_Stein's picture

 

LOL !

 

But cover the lower half, otherwise it'll rain in.

 

Fri, 06/03/2011 - 15:07 | 1337092 GeneMarchbanks
GeneMarchbanks's picture

When Moody's is warning you... ... that's bad. Those guys are real 'tards.

We're going into the 60's on the DXY before summer end. I dislike making predictions but this one seems a good bet. We'll see...

 

Fri, 06/03/2011 - 15:14 | 1337102 SheepDog-One
SheepDog-One's picture

OK so USD guaranteed to pop straight up and Euro and all others down. Well for some 48 hour period anyway before it all flip flops the other way.

Fri, 06/03/2011 - 15:15 | 1337103 TruthInSunshine
TruthInSunshine's picture

Everything is breaking down.

None of the old tricks work anymore. We're seeing dollar down, equity market down, commodity market down days.

At some point, the realization as to how truly awful and in what utter shambles the structural and organic economy is in will dawn on even the most loyal of the Main Stream Media watching/listening sheeple, and there won't be any tricks or ability to deceive any longer left on the table. Some will refer to this as some sort of great awakening, in retrospect.

Are we there or on the cusp of being there now? I don't know, but based on my personal interaction with the world, I'd have to declare that, yes, we are indeed at least on the very edge of the cusp, and it's going to accelerate rapidly if I'm correct in that some of the most naive are beginning to see a portion of the ugly reality that government, media and Wall Street/Banking sock puppets have been doing their best to conceal.

Any actual green economic shoots withered a long, long time ago, and now even the propagandist slogan of 'green shoots' has withered.

The real question that should be on the minds of the enlightened is not whether there will or will not be additional monetary policy by Bernankincide similar in form or size to past iterations (whether it's called QEx or TWy), but rather, whether any such further monetary policy are likely to create similar results as in the past.

 

Fri, 06/03/2011 - 15:18 | 1337134 Alcoholic Nativ...
Alcoholic Native American's picture

Never underestimate propaganda lol. I'm sure they will pull something out of their hat.  Just the other week they said they killed Osama Bin Laden and everybody bought it.  You know technically, we are not even in a recession.

Fri, 06/03/2011 - 16:24 | 1337459 trav7777
trav7777's picture

...as opposed to losses of greater than that MONTHLY in men, materiel, fuel, and related equipment in these wars we run?

FY11 has these two at budgeted cost of $170B

Fri, 06/03/2011 - 15:15 | 1337106 alien-IQ
alien-IQ's picture

that should pretty make a E/U closing nose dive a near certainty.

Fri, 06/03/2011 - 15:16 | 1337110 Josh Randall
Josh Randall's picture

2 reasons: Payback for the suponea; and help threaten the debt ceiling resistors

The squid can rot -- it will one day, because as soon as their clients are sucked dry, they will be dead themselves, thats the thing with parasites in a small aquarium, they will end their own life eventually with their last host

Fri, 06/03/2011 - 15:26 | 1337184 Bob
Bob's picture

last i knew, all of humanity was hosting gs.  did i miss an update?

Fri, 06/03/2011 - 15:17 | 1337115 Cheesy Bastard
Cheesy Bastard's picture

Goldman has never decieved anyone, ever.   Very possibly the opposite will happen; equity weakness and dollar strength on a weak euro.

Fri, 06/03/2011 - 15:14 | 1337117 buzzsaw99
buzzsaw99's picture

such a nice bank holding company.

Step 1) Secure gubbermint guarantees.

Step 2) Bite the hand that feeds.

it's a man baby!

http://www.youtube.com/watch?v=WgOIEGz7o_s

 

Fri, 06/03/2011 - 17:01 | 1337555 NumberNone
NumberNone's picture

It's manbearpig..

http://www.youtube.com/watch?v=xf69EEL3WBk 

 

 

Fri, 06/03/2011 - 15:17 | 1337118 Caviar Emptor
Caviar Emptor's picture

So where are we now? 

Full blown deflation in the housing and jobs market (aka Main Street) in the midst of a Fed-distorted stock and bond market and incipient inflationary pressures hurting margins and consumers. S&P earnings estimates already on the decline. ECRI weekly leading index down 6 in a row. 

Not even the vaguest suggestion from "our leaders" that we should do anything differently. In fact, they want more of the same: upper income tax breaks (boy that sure worked) and cuts in benefits that disproportionately impact the middle class (can't catch a break). And let the Fed keep working it's magic. 

The outcome is certain. 

Fri, 06/03/2011 - 15:15 | 1337124 connda
connda's picture

Thanks Goldman -- Buy USD.

Fri, 06/03/2011 - 15:16 | 1337126 suckerfishzilla
suckerfishzilla's picture

This will hurt most the people who aren't paying any attention to that boring subject of economics finance what have you.  Don't get me wrong in my eyes I find this just a new despicable maneuver on the part of Goldman. The Bankers think that they are going to take everybody down with them.   They really live an a world of opulent illusion.  I can't wait to see the videos of how the public will deal with them in the end. 

Fri, 06/03/2011 - 15:23 | 1337169 Alcoholic Nativ...
Alcoholic Native American's picture

Yea, right, our cream of the crop west point retards were chanting USA USA USA as they faked killing Osama the other day, the general public is even less likely to put blame where blame is due.  Bet on it.

Fri, 06/03/2011 - 16:26 | 1337465 trav7777
trav7777's picture

you want another Holocaust?

Fri, 06/03/2011 - 16:32 | 1337482 suckerfishzilla
suckerfishzilla's picture

What I want seems to be insurmountable.  End the nuke industry end the fed irs cia.  End hemp and pot prohibition.  I've been watching this crap for more than half a century.  It is getting worn out.

Fri, 06/03/2011 - 16:39 | 1337496 suckerfishzilla
suckerfishzilla's picture

What kind of question is that?  We all are capable of reason here except for the paid trolls.  There is a criminal cartel controlling money and finance in the USA.  Watching them get the Mussolini treatment would be worth the wait.  A holocaust would mean punishing a segment of the public in a social witch hunt?  Are you serious?

Fri, 06/03/2011 - 15:24 | 1337150 user2011
user2011's picture

GS has been accused of manipulating the oil market.   With Obama trying to suppress the oil price.  GS raised their target on oil.   Now, they are being subpenoed for another case.   And GS continue to show their attitude by downgrading the USD.    I think it tries to sink Obama meanwhile try to gouge profit on the oil market.     With inventory up and economy down around the globe, the only way to push the oil prices are war in middle east and weak dollar.  

I doubt GS can start a war in OPEC countries just like that, so they choose to downgrade USD.

 

 

Fri, 06/03/2011 - 15:21 | 1337151 drshock18
drshock18's picture

OR they're just pulling the old Goldman bait and switch right before QE 2 ends.

Fri, 06/03/2011 - 15:24 | 1337170 Silver Bug
Silver Bug's picture

I've learned long ago not to believe anything these crooks say. Obviously the USD is heading lower long term.

 

http://silverliberationarmy.blogspot.com/

Fri, 06/03/2011 - 15:34 | 1337215 Zing
Zing's picture

No way we breach the recent lows on the DXY.  There has to be massive strengthening before they can begin QE3.  Everyone trading end of the dollar is about to lose a lot of money.

Fri, 06/03/2011 - 15:47 | 1337279 drshock18
drshock18's picture

I agree. The COT reports show a huge net decrease in large speculators long the euro. Likewise there has been a net increase in large speculators in the DXY over the last month.

I find it hard to believe that Goldman is going to try and double down on the euro in the face of QE 2 expiring- not to mention yields falling on UST's and pitiful economic data coming out. The dollar by all means should have rallied this week, but I guess we now know why it didn't.

Fri, 06/03/2011 - 16:14 | 1337426 Slim
Slim's picture

Agree.  Anyone buying EUR at these levels has to be insane.  We got here under speculation that USD printing would go forever and that EUR was tightening (and I'd assume a naive assumption that the monetary union would be patched without much hassle).  Both of those assumptions are off the table currently and money is pulling back from risk which should turn down USD levererd carry etc...

 

Without full transparency into their own books to see where they are positioned and how they will benefit I'd be warry.  Banks have been making a mint trading these markets and I'd assume they have a vested interest in keeping it moving as when the music stops, further capital impairment begins. 

Fri, 06/03/2011 - 16:43 | 1337504 Quinvarius
Quinvarius's picture

Have you considered that the no QE is worse for the dollar than QE?  Because that is the fact.

Fri, 06/03/2011 - 15:36 | 1337239 pauldia
pauldia's picture

11:30am toi 1:00pm seems like POMO offers opportunity to find buyers and place your short positions. Thank You, Mr Sack.

 

Dow 12,147.33 -101.22 -0.83%

Fri, 06/03/2011 - 15:41 | 1337249 slewie the pi-rat
slewie the pi-rat's picture

moody's, buffett, & the squid.  Act II. 

Fri, 06/03/2011 - 15:59 | 1337339 Shell Game
Shell Game's picture

Am short Crude and DBC over weekend. Guess that reveals my Dollar short-/intermediate-term view..

Fri, 06/03/2011 - 15:59 | 1337340 russwinter
russwinter's picture

This debt ceiling talk has a real straw man decoy look to it.

http://americansresistance.blogspot.com/2011/06/debt-trap-straw-man.html

Fri, 06/03/2011 - 16:02 | 1337364 IdioTsincracY
Fri, 06/03/2011 - 16:09 | 1337400 ArrestBobRubin
ArrestBobRubin's picture

First they knife it in the back, then they knife it in the back.

No surprise really, it's no diffrent from the treatment Goldman gives it's own suckers.

I mean "clientele".

Fri, 06/03/2011 - 16:27 | 1337467 chinaguy
chinaguy's picture

USD/CHF .835 even

Fri, 06/03/2011 - 16:35 | 1337481 augie
augie's picture

red dragons.

Fri, 06/03/2011 - 17:07 | 1337502 mr. mirbach
mr. mirbach's picture

This is a must read from Matt Taibbi: http://www.rollingstone.com/politics/news/the-great-american-bubble-machine-20100405

Goldman Sachs = puppet master extrordinaire among puppet masters.

Any entity that can be on three (or more) sides of the same trade:

A) should be prosecuted

B) should be drawn and qurtered

C) should be regulated

D) should be immune from black letter law

E) should be left alone to install favorable legislators and regulators

 

Usually GS tells .gov what to do behind closed doors. This announcement may be a show of strength to the sheeple proclaiming to all that they ARE in control. The debt ceiling will be raised on Monday shortly after the FED's QE 3 press release. The question is, how do they work so many puppets at the same time? Long strings?

Amerika - Land of Oppression

 

 

Fri, 06/03/2011 - 16:51 | 1337530 Quinvarius
Quinvarius's picture

As stated many times, during many USD bounces, if you go long the USD, you will get taken to the cleaners.  The USD is in far worse shape and our Federal debt is an all or nothing propositon.  Stop watching TV for dirt on the Euro.  If we don't raise the debt limit, our ability to fund our debt backed Dollar ponzi disappears.  We sure are not going to do it with tax money.  No QE and no raise to the debt limit is instadeath for the dollar.  QE and more debt allow us to extend into merely high inflation.  You don't fix a ponzi by cutting off its source of new funding.  That is how you end it.

Fri, 06/03/2011 - 16:55 | 1337545 IdioTsincracY
IdioTsincracY's picture

+1 .... unfortunately!

Fri, 06/03/2011 - 17:19 | 1337614 Yen Cross
Yen Cross's picture

  Here it is!  QE- greenback. Exports will save the nfp reports. I haven't traded the usd in 2 weeks.

Fri, 06/03/2011 - 17:20 | 1337620 slaughterer
slaughterer's picture

FADE THIS GOLDMAN REPORT>  GO LONG THE USD>  THEY ARE SETTING YOU UP!

Fri, 06/03/2011 - 17:28 | 1337631 Yen Cross
Yen Cross's picture

  I think 74 works better for resistance. I have done quite well trading chf and yen against the usd, aud,eur.  Make sure you keep your eyes on 10's for the usd/yen trade.

Fri, 06/03/2011 - 17:44 | 1337687 PulauHantu29
PulauHantu29's picture

Hey, as long as Ronnie McDonald has a dollar menu I'm in good shape. Even Wendy's has a knock-out chicken wrap now for a Buck....that's purchasing power imo. If, or when, the dollar menu becomes $2 Bucks, I will have to cut back more.

Fri, 06/03/2011 - 19:14 | 1337973 Yen Cross
Yen Cross's picture

  Go hit that dollar menu in Europe or Japan. Then you will see some real 10 usd$ value meals!

Fri, 06/03/2011 - 18:42 | 1337872 TexDenim
TexDenim's picture

Oh, my! Lloyd Blankfein just makes my nipples tingle.

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