US equity markets closed a negative week, on a positive note, posting gains across the board. The week was dominated by urgency in global bond markets, with intervention from the US Treasury, failing to quell fears or bond yields. The underlying problem is massive deficits and debt. This problem is not fixed through intervention in the bond markets, or printing more Dollars, from the Fed. Deficit spending and consequential overwhelming debt levels are destroying Western economies. The energy crises only serves to focus the reality of the crisis. The US Dollar remained weak, with the EUR trading back toward 1.1700, while the GBP jumped to 1.3650.
Commodity currencies were beneficiaries of a wounded reserve, with the NZD trading around 0.5950, while the AUD hit 0.7150. NZ Trade numbers, released last Friday, revealed an almost $2 Billion deficit, just for July. This is a blowout number and reflects the massive cost of energy imports, which will drive the energy crisis. The coming week will be focused on growth and inflation, while Central Bankers will meet at the annual ‘Jackson Hole Symposium’.
