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S&P500 Around the World

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7

April 25, 2011 – Comments (4)

This article takes a look at how the S&P500 returns this year look in some other currencies. 

US stock investors have done pretty well this year, but those gains take a hit or even turn in to losses when measured in some other currencies.  The weak dollar has been a big part of positive US stock market returns to date this year.  A Swedish investor holding US stocks? - not so much.

I also found a few US companies that generate less than half their revenues in the US.  If the dollar keeps sliding, currency exchange should be a tailwind for those companies and others with significant ops outside the US.

Many thanks to fellow Fools who commented or rec'd my blogs on this subject - that pushed me to write the article.

Your thoughts?  Anyone expect anything substantial from Chairman Bernanke's press conference later this week?

Fool on!

Russ

4 Comments – Post Your Own

#1) On April 25, 2011 at 9:55 PM, portefeuille (99.44) wrote:

5y chart (April 20, 2011).



enlarge

 

5y chart minus 2008 and 2009 (April 20, 2011).



enlarge

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#2) On April 25, 2011 at 10:15 PM, rd80 (98.69) wrote:

Port,

Many thanks for the charts.

Fascinating how big the spread is between the returns of the world's markets.

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#3) On April 25, 2011 at 10:34 PM, goalie37 (94.39) wrote:

The people running our economy seem to think that a weak dollar is in our best interest.  But logic tells me that a weak dollar is worst for people who have dollars...namely everybody in the US.  How can debasing the currency in my wallet be good for me?

 

Tomorrow we get to hear Bernanke tell us there is no inflation.  That should be fun. 

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#4) On April 26, 2011 at 2:31 AM, awallejr (82.76) wrote:

I am not a proponent of a strong dollar.  I think it hurts us in the long run now.  When we controlled the world economy that was one thing.  With globalization things have changed.  We need to sell stuff to the world and a lower dollar makes it easier to do so.  Now a crashing dollar on the other hand would not be good but I don't see that happening.

Yeah oil is going up, but if you followed my blogs over the years I always tell people this is the season for oil.  By August, if not sooner, it will have fallen below $100, assuming no major developments in the Middle East disrupting supply.

Now if you are sitting on piles of cash I am sure you are hoping the FED jacks up rates dramatically in order to earn more interest. But that ain't gonna happen anytime soon.  Bernanke has made it eminiently clear that he will do whatever is within his power to prevent another "Great Depression."  And that takes priority to "strong dollar" policy.  I suspect he will say at the press conference, that while QE2 is coming to an end, the FED will reserve the right to do what may still be necessary to insure a depression doesn't occur.  Bears won't like hearing that.

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