White House Admits "Strong Dollar Is Headwind For Growth" As Greenback Surges At Fastest Pace In 34 Years

Tyler Durden's picture




 

Forget 2013's "taper tantrum", FX markets are roiling over a full-blown "rate-hike-rage" as the USD Index surges to a new 12 year high, rising 23% in the last 8 months - the fastest surge since 1981. Not only is this dramaticaly bad for the US equity earnings picture but the carnage being unleashed across developed and emerging market currencies is almost unprecedented. Despite reassurance from The Fed that a strengthening dollar is positive for US jobs, The White House has now issued a statement that a "strengthening USD is a headwind for US growth."

 

The USD Index has risen at the fastest pace in 34 years...

 

Despite previous reassurances from Bullard, Fisher et al.

Sharp gains in the U.S. dollar are good for the U.S. labor market, a top Federal Reserve official said on Friday, downplaying a crescendo of complaints from top executives over the dent to their profits.

 

"CEOs that have international operations complain about it," Dallas Fed President Richard Fisher told Reuters in an interview. "I hear from every one of them - it offsets their powerful earnings here domestically."

 

Fisher takes those complaints with a grain of salt.

 

"It brings to my mind the vision of Edward Munch’s painting 'The Scream'," he said, adding, "It's not the end of the world."

 

Fisher, who plans to retire from his post in March, holds views that are often far from those at the Fed's core. Still, the former hedge-fund manager says he feels his views are heard at the policy-setting table.

 

"The more income and investment flows we get, the better it is for our companies big and small to go out and hire American workers," Fisher said. "And it does help on the consumption side, if, for example, oil is denominated in dollars, it just helps us have cheaper goods."

The White House is getting nervous:

  • *FURMAN SAYS STRONG DOLLAR IS HEADWIND FOR U.S. GROWTH

And rightly so...

 

leaving a trail of crushed currenciues behind it...

Did the SNB suffer the biggest daily loss ever for nothing? USDCHF almost roundtripped from the de-pegging...

 

EURUSD is collapsing to fresh 12 year lows (but appears to have further to fall)

 

Overnight, EM FX was monkey-hammered... (note the green postive moves are all USD positive, local FX negative) and many are back at record lows...

 

 

Unambiguously not good?

 

Charts: Blooomberg

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Tue, 03/10/2015 - 08:56 | 5872754 Thirst Mutilator
Thirst Mutilator's picture

I'm not exactly into CHARTS, but the dollar index has been one of more predictable charts for more than a decade now. If the pattern continues, there's still a ways to run.

 

http://4.bp.blogspot.com/-p20z39BnSpA/VPpBZptFgDI/AAAAAAAAaFU/_DZwkD1VPb...

Tue, 03/10/2015 - 09:00 | 5872769 Haus-Targaryen
Haus-Targaryen's picture

Deflation then inflation. 

Tue, 03/10/2015 - 09:02 | 5872777 NoDebt
NoDebt's picture

Nobody likes a global currency war.  But if there's a currency war, you better be shooting.

 

Tue, 03/10/2015 - 09:04 | 5872783 Took Red Pill
Took Red Pill's picture

" STRONG DOLLAR IS HEADWIND FOR U.S. GROWTH"

HA HA HA! That's a good one!

Tue, 03/10/2015 - 09:19 | 5872835 Headbanger
Headbanger's picture

It is hillarious.

The WH idiots have to blame something that still sounds good like STRONG dollar.

Tue, 03/10/2015 - 10:00 | 5872881 astoriajoe
astoriajoe's picture

and headwind to growth, implying ...growth.

Tue, 03/10/2015 - 10:36 | 5873153 g speed
g speed's picture

what they mean is good for savers --bad for debt whores (like banks etc.) Good for American workers-- bad for international conglomerates that bought their own stock last year--Good for mom and pops--bad for politicians that get rake from gov't mandated monopoly corps---Lying sack of shit Obama and his ilk--

Tue, 03/10/2015 - 13:37 | 5873986 Took Red Pill
Took Red Pill's picture

I haven't seen the bank rates savings interest rates yet

Tue, 03/10/2015 - 09:34 | 5872903 NoVa
NoVa's picture

other WH comments not released today (but will soon be released):

2 + 2 = 5

War is Peace

Slavery is Freedom

Ignorance is Strength

 

NoVa

 

Tue, 03/10/2015 - 10:30 | 5873134 max2205
max2205's picture

We'd all be  better off if the white house just goes on vacation for the next 2 years.  Pllllleeeeease!

Tue, 03/10/2015 - 09:05 | 5872786 Haus-Targaryen
Haus-Targaryen's picture

Or have a ton of Gold and have fake BüS license plates ready to go. 

Tue, 03/10/2015 - 09:05 | 5872785 SamAdams
SamAdams's picture

No one ever wants to claim credit for the lie.  It is always, "The White House Says", "A White House Official Said", "A White House Source Said"....

Tue, 03/10/2015 - 09:02 | 5872773 SethDealer
SethDealer's picture

how can the dollar be strong when the fed just got through printing a ton of them?

Tue, 03/10/2015 - 09:06 | 5872787 Philo Beddoe
Philo Beddoe's picture

The Fed is hawkish now. Santa is real too. 

Tue, 03/10/2015 - 09:23 | 5872854 Ghordius
Ghordius's picture

it was weak, when Emerging Markets started to issue bonds denominated in USD. the dollar has two faces: one at home, and one abroad

Tue, 03/10/2015 - 09:58 | 5872890 astoriajoe
astoriajoe's picture

paper now reinforced with hemp fiber? much stronger

Tue, 03/10/2015 - 09:52 | 5872972 Mayer Amschel R...
Mayer Amschel Rothschild's picture

Creating a inauditable quantities of digital FRNs for bankster cronies is not the same as printing and releasing into cirulation.

Tue, 03/10/2015 - 11:50 | 5873437 NihilistZero
NihilistZero's picture

EXACTLY! That money was purposed for 2 tasks. Transferring the bad RE from the banks to private equity and then re-inflating the Housing Bubble. Those missions accomplished the freshly capitalized banks can take advantage of the coming bust in ways they weren't prepared to in 2008.

Those predicting perpetual inflation seem to be forgetting who benefits the most in a deflationary cycle. It sure isn't the few of us down here responsible enough to take advantage of it through savings and prudence. It's the same scumbags who make out like bandits during the inflationary cycles. The money changers are always winning.

Tue, 03/10/2015 - 11:40 | 5873419 Monty Burns
Monty Burns's picture

I'd say first, lack of alternatives since the Euro went pear-shaped and second,  market manipulation.

Tue, 03/10/2015 - 11:00 | 5873275 FuzzyDunlop21
FuzzyDunlop21's picture

can someone explain to a noob what eurusd st swap model is?

Tue, 03/10/2015 - 08:57 | 5872758 SheepDog-One
SheepDog-One's picture

What's man-God Obama gonna do about it?
A. Smoke some crack.
B. Suck some dick.

Tue, 03/10/2015 - 09:10 | 5872804 cossack55
cossack55's picture

C. Hit the links

Tue, 03/10/2015 - 09:46 | 5872951 CuttingEdge
CuttingEdge's picture

D. Fuck a Wookie

Tue, 03/10/2015 - 09:53 | 5872980 Seasmoke
Seasmoke's picture

I am down to A B or C. Definitely not D. 

Tue, 03/10/2015 - 09:04 | 5872760 hotrod
hotrod's picture

Look Mom,, we dont even have to raise rates and we can increase the debt limit.  No problems everyone loves our currency.

 

Tue, 03/10/2015 - 09:39 | 5872927 Took Red Pill
Took Red Pill's picture

That's why Russia &  company are dumping them

Tue, 03/10/2015 - 08:59 | 5872764 T-NUTZ
T-NUTZ's picture

BLOWOFF TOP!  USD will top and reverse hard within the next two weeks.  

Tue, 03/10/2015 - 09:04 | 5872782 Philo Beddoe
Philo Beddoe's picture

I would like to see the USD weaken and Oil head toward 40/30. That would lead to some interesting consequences. 

Tue, 03/10/2015 - 09:06 | 5872788 The_Virginian
The_Virginian's picture

There is $9T in dollar-denominated debt in the rest of the world and a $6T dollar carry trade. Both of those are going to get unwound in the face of dollar strength in the next two years. Betting against the dollar in the near term is a fool's errand. Bet against Emerging Markets and China. 

Tue, 03/10/2015 - 09:08 | 5872794 venturen
venturen's picture

sure which crap curency you going to buy? Euro, Yen, Yuan, Ruble, Mexican Peso, Bitcoin? 

Just looked at a chart of Japanese GDP in Yen,,,what a disaster too much debt is. We are all going to be Japan in the near future.

Tue, 03/10/2015 - 09:37 | 5872917 T-NUTZ
T-NUTZ's picture

Silver Bitchez!!

Tue, 03/10/2015 - 09:48 | 5872959 Stormtrooper
Stormtrooper's picture

I want the currency with the highest btu content per ton.

Tue, 03/10/2015 - 09:01 | 5872772 NoDebt
NoDebt's picture

Well, that long term chart sort of puts things in perspective, doesn't it?

 

Tue, 03/10/2015 - 09:09 | 5872799 Thirst Mutilator
Thirst Mutilator's picture

I'll tell you something... I'm not much into charts, but that one I linked has been very consistent...

 

Tracing the highest high to the lowest low, it would not be difficult at all to imagine that the next HIGH would end in a way that the chart forms a giant pennant, whereby the end of the pennant pointed at a time in the future that was equal to PAR [100]... Ostensibly leading to some great reset.

 

That's assuming that the clowns can keep things together for that long, but there's no denying that it's gone on quite a long time with spit & paperclips...

Tue, 03/10/2015 - 09:04 | 5872780 buzzsaw99
buzzsaw99's picture

won't somebody please think of those poor, poor, ceos?

Tue, 03/10/2015 - 09:07 | 5872781 Quinvarius
Quinvarius's picture

Sadly, it has more to do with every other piece of paper dying first than a fantastic USD.  The USD is part of the machinery of a dying system the other paper feeds off of.  It is a system that hinders the global economy to enrich a few bankers politicans that abuse it.  It is being replaced because it is no longer useful to commerce.  First, the users of the broken system must die off like people in the desert trying to drink out of an empty canteen.  Then the useless canteen is tossed.

Tue, 03/10/2015 - 10:26 | 5873111 world_debt_slave
world_debt_slave's picture

I remember rumours of the Amero

Tue, 03/10/2015 - 09:09 | 5872803 papaswamp
papaswamp's picture

NIRPish?

Tue, 03/10/2015 - 09:10 | 5872806 venturen
venturen's picture

I hear it said that Obama like it Strong....not sure they were talkling currencies

Tue, 03/10/2015 - 09:14 | 5872816 hotrod
hotrod's picture

Volcker made it look so hard,  this strong currency stuff is Eeeeeasy.

Tue, 03/10/2015 - 09:19 | 5872832 overmedicatedun...
overmedicatedundersexed's picture

OT:

 

IG Audit: 6.5 Million People With Active Social Security Numbers Are 112 or Older March 9, 2015 - 10:39 AM Share on Facebook Share on Twitter

An IG audit of the Social Security Administration found that the nation’s database of active Social Security numbers includes more than six and a half million people who are older than 112 years of age.

(CNSNews.com) - Many people are living longer, but not to age 112 or beyond -- except in the records of the Social Security Administration.

The SSA's inspector general has identified 6.5 million number-holders age 112 -- or older -- for whom no death date has been entered in the main electronic file, called Numident.

The audit, dated March 4, 2015, concluded that SSA lacks the controls necessary to annote death information on the records of number-holders who exceed "maximum reasonable life expectancies."

"We obtained Numident data that identified approximately 6.5 million numberholders born before June 16, 1901 who did not have a date of death on their record," the report states.

Some of the numbers assigned to long-dead people were used fraudulently to open bank accounts.

And thousands of those numbers apparently were used by illegal immigrants to apply for work:

"During Calendar Years 2008 through 2011, SSA received 4,024 E-Verify inquiries using the SSNs of 3,873 numberholders born before June 16, 1901," the report said. "These inquiries indicate individuals' attempts to use the SSNs to apply for work."

Sen. Tom Carper (D-Del.), the committee's ranking member, called the findings a "major problem" that wastes taxpayers' money, exposes citizens to identity theft and undermines confidence in government:

"It is simply unacceptable that our nation’s database of Social Security numbers of supposedly living people includes more than six and a half million people who are older than 112 years of age, with a few thousand having birth dates from  before the Civil War. Preventing agency errors by keeping track of who has died is a relatively simple problem that the government should pursue as a high priority."

Tue, 03/10/2015 - 09:56 | 5872994 TheReplacement
TheReplacement's picture

Just imagine how many are 90+....

Wonder how old Obama's SSN is.

Tue, 03/10/2015 - 10:35 | 5873154 Jethro
Jethro's picture

Which SSN?  I think he's had several attributed to him.

Tue, 03/10/2015 - 09:24 | 5872857 The_Virginian
The_Virginian's picture

Race to the bottom. The dollar is losing. Fed will never be able to raise rates. It will wreck our GDP and exports. Eventually, they will - one day - lose credibility. Then you'll get your dollar collapse. 

Tue, 03/10/2015 - 09:58 | 5873004 TheReplacement
TheReplacement's picture

Nah.  It is a race for the exits with the BRICS leading the way.  Of course the FED will have to go negative and probably start printing again.  That is about the time the dedollarization door will slam shut and our exported inflation will come flooding home.

Tue, 03/10/2015 - 12:28 | 5873568 Babaloo
Babaloo's picture

"The dollar is losing (?)" WTF does that even mean?  Do you even think about what you write?

Then you get dollar collapse?

Gawd, just shut up and quit posting - you're just demonstrating your own ignorance.

Tue, 03/10/2015 - 09:29 | 5872873 orangegeek
orangegeek's picture

any excuse to claim growth - with a communist in white house the assumption is "lying cocksucker" until proven otherwise.

Tue, 03/10/2015 - 09:29 | 5872876 madcows
madcows's picture

What about the ACA and Amnesty?  What about the National Debt/Deficit?  What about the higher tax rates?  What about the millions of pages of new regulations?  Are those headwinds, too?

Tue, 03/10/2015 - 10:57 | 5873266 ultramaroon
ultramaroon's picture

Call them "headwinds", but they are giant La Brea tar pits, they are cancers that kill the hosts, they are the overwhelming Golden Horde, they are extortion, they are the disappearance of productivity, they are the invitation for war, they are the breakdown of infrastructure, they are the collapse of the system.

1) Strong dollar - Hurts manufacturing and exports.
2) ACA - Sucks up most people's disposable income.
3) Amnesty - Adds millions of competitors for scarce resources, strains infrastructure.
4) National Debt/Deficit - US can barely service the existing debt. Deficit spending worsens the future crisis.
5) Higher tax rates coming - Government is wasteful, and people are already being forced to cut back because of high taxes.
6) Millions of pages of new regulations - More regulation equals more inefficiency, more waste, and erosion of civil rights.

Tue, 03/10/2015 - 09:32 | 5872892 laomei
laomei's picture

Strong dollar? Sounds like a great excuse to dump reserves and buy up whatever's left to buy in the US.  Conversely, strong dollar? Say so long to whatever manufacturing was left in the US.

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