Well at last the dollar has started to fall, along with iron ore prices, and the stock market gave up 1.2% over the week, in case you lost count. And those with great memories tell me it's the worst week in six.
Apart from the miners, the big banks and Telstra had a rough time, which doesn’t bother me as it creates an opportunity to buy more of these quality companies, provided you’re happy with nice little gains dominated by income over the next year.
You might be wondering why the market hasn’t greeted the overdue drop in the dollar with glee. Well, blame the exodus of foreign investors, who might be thinking “let’s get out before that currency crashes!” Of course, it won’t. In fact, Westpac’s Bill Evans thinks it will only go to 90 US cents this year. This could be too conservative but it shows that long-term economic watchers aren’t expecting a 1986 Banana Republic re-run, where the dollar headed towards the 50 US cents region. This morning it’s 90.73 US cents.