Download now: Gold and Silver Mining Stocks

Roubini Predicts a Dollar Reversal

Dollar Up, Dow Down

Written by Steve Christ
Posted October 26, 2009 at 5:02PM

Here's another great interview from Nouriel Roubini. He appeared on CNBC this morning explaining how the dollar carry trade has helped to inflate the markets —from stocks to commodities—to bubbly valuations.

The famed bearish economist told CNBC,"Now we are in the mother of all carry trades" noting that cheap dollars are pushing asset prices higher across the board.

The danger, he said, is when this trade reverses and the dollar inevitably heads higher. At that point, Roubini warned , there could be "a market crash all over the world"

Here are the cheery details.....












 

As for the dollar, the correlation with the rest of the market remains as strong as ever. In fact, when the dollar (UUP) rallied this morning the Dow (DJI)fell 200 points off the high.

Take a look:

 

usddow



 

Dollar up, Dow down....it is as simple as that.

Related Articles:

Jim Rogers on Gold, the Dollar, and Inflation

Roubini, Soros and Prechter...Oh my!

Ron Paul: End The Fed

Stiglitz Says Problems Have "Become Even Bigger"

To learn more about Wealth Daily click here

Comments

Buffett's Envy: 50% Annual Returns, Guaranteed