Life Insurers Hit
Stocks were up most of the day, but fell like a rock after the FED announcement. They didn’t say much, but the market decided to take some profits.
Bonds, and Gold moved sideways.
The Dollar continued its fall, hitting 1.48 against the Euro. It pulled back a little today.
Oil and gasoline pulled back a lot today as demand was deemed to be lacking.
In the news today……
Carry Trade Currency – is now the US Dollar. It used to be the Japanese Yen and the Swiss Franc. The Carry Trade Currency is artificially forced down against most other currencies as people borrow/sell the Carry Trade Currency, and buy the second currency to invest in a higher interest rate instrument. The US Dollar is now plunging against the Euro. When I first started this trip to Europe, the Euro was about 1.35. It is now 1.48 to the Dollar. Wow, what a ride if you are in the currency market. Somebody is making billions of dollars on this move of the Dollar.
Life insurers – hit hard by soured real-estate investments, are trying to recoup their losses by boosting prices on life insurance while selling less of it, and by charging higher premiums for risk factors like obesity and hypertension. The moves, along with a more frugal consumer, contributed to a 23% drop in sales in H1, the largest drop in nearly 70 years. What does this mean for you??? In the longer run, insurance companies could be going bankrupt when they can’t pay out their policy claims.
Here are the last numbers for today (about 40 min before closing):
Dow Jones 30 Industrial – 9749 (down 81 points)
10 Year Treasury Bond – 3.42% (down 0.04%)
Euro – $1.4739
Gold – $1014 (down $1)
Oil – $68.97 (down $2.79)
Gasoline – $1.70 (down $0.08)
