Stocks Shouldn't Blindly Follow Dollar's Path

Tomi Kilgore MarketWatch October 28, 2010

Become a MarketWatch member today

Tomi Kilgore

Oct. 28, 2010, 12:01 a.m. EDT

View all Tomi Kilgore "?

"? Previous Column

Stocks can rise without financials leading

First Take "?

For Wall Street, a chance to prove itself with GM

By Tomi Kilgore

NEW YORK (MarketWatch) "â? A falling dollar and rising stocks, and vice versa, have gone hand in hand for quite a while, but Wall Street investors need to break the habit of looking to the currency market for guidance.

Not only does the dollar-equities inverse relationship appear to be breaking up, but a weak greenback hasn't always been the best scenario for stocks in the past.

Financial markets seem to be having a rethink about quantitative easing. They still think they'll get some, but perhaps it'll be a steady flow than the tsunami some had hoped.

Since Oct. 14, the day before Federal Reserve Chairman Ben Bernanke all but confirmed that a second round of quantitative easing "â? or "QE2"? "â? was coming, the 10-year Treasury yield has climbed about 14 basis points. Since then, as well, the U.S. Dollar Index /quotes/comstock/11j!i:dxy0 (DXY 77.27, -0.88, -1.12%) has advanced 1.4% and the S&P 500 Index /quotes/comstock/21z!i1:in\x (SPX 1,179, -3.49, -0.30%) has added 1%. Basically, the markets are starting to act as they would if economic growth was expected to accelerate. See MarketWatch's currency tools page.

It was more of the same Tuesday, as the 10-year yield rose 8.2 basis points, the dollar index gained 0.7% and the S&P 500 fought off early losses to inch fractionally higher.

A weak-dollar policy worked after the recession of 2001, but, then, after a seven-year run of dollar strength, a little weakness didn't rile too many overseas trading partners.

/quotes/comstock/11j!i:dxy0 DXY 77.27, -0.88, -1.12% Downhill dollar U.S. Dollar Index since mid-'80s.

The current situation, with talk of a "currency war"? making the rounds, seems a little more like what happened 17 years ago. The U.S. economy, which had just come out of a credit-crisis-induced recession, was stalling. In the first quarter of 1993, gross domestic product growth fell to 0.7% from 4.3% in the previous quarter. In addition, there was considerable concern about how a currency believed to be very undervalued "â? the Japanese yen "â? was holding back the U.S. economy by undermining the trade balance.

In February 1993, when then"â??Treasury Secretary Lloyd Bentsen was asked if he'd like to see a weaker dollar, he answered, "I'd like to see a stronger yen."? The dollar subsequently slumped against more than just the yen, troubling finance officials of a number of key U.S. trading partners.

Change "yen"? to "yuan"? and things aren't so different today.

Treasury Secretary Tim Geithner has repeated that a strong dollar is in the U.S.'s best interest, but expectations of QE2 have weighed heavily on the greenback, with the dollar index down 6.6% since the end of August. Geithner also said over the weekend that China's currency is "significantly undervalued."?

Meanwhile, the finance ministers of the world's top economies tried to defuse a currency conflict by saying countries should refrain from competitive devaluation.

Reuters Japanese 10,000-yen notes spread out next to U.S. $100 bills at an exchange office in Tokyo.

The weak dollar wasn't such a big help to stocks 17 years ago. The S&P 500 edged up just 7.1% in 1993 before falling 1.5% in 1994, although GDP growth improved to 2.9% in 1993 and 4.1% in 1994.

Stocks didn't take off until Bentsen handed the Treasury's reins in January 1995 to Robert Rubin, who launched the strong-dollar policy that still exists, in theory, today. The S&P 500 ran up 34% in 1995 and climbed 20% in 1996, although GDP growth slowed to 2.5% in 1995 and 3.7% in 1996.

No wonder the U.S. continues to say it wants the dollar to stay strong.

Tomi Kilgore writes Taking Stock, a column featuring insightful analysis of equity-related topics around the world. This column originally appeared on Dow Jones Newswires.

Add Comment â?º · Recommend · Post: Alert Email Print More Tomi Kilgore Oct. 22, 2010 Stocks can rise without financials leading Oct. 8, 2010 Energy-sector reversal could be for real Sept. 30, 2010 J.P. Morgan Chase bears should worry Sept. 9, 2010 Bulls should welcome inevitable pullback Aug. 20, 2010 McAfee has what Intel wants: a rising stock Explore related topics Japan US Dollar Index Future - Spot Price S&P 500 Index Comments Screener First Take For Wall Street, a chance to prove itself with GM

The GM IPO isn't just about finding the best price. Bankers will have to weigh how many shares the market can absorb. Too many will dampen the prospects of taxpayers of getting an acceptable return on their $40 billion investment. Too few, and it could be a missed opportunity.

10:52 a.m. Today10:52 a.m. Oct. 28, 2010

Most Popular Most readMost commented Economy is running out of gas QE2 a "?Ponzi scheme,' says Pimco's Gross Weekly jobless claims fall 21,000 to 434,000 U.S. futures gain on busy earnings day Critic of Goldman buys Goldman stock Stocks end lower on concern over Fed moves Weekly jobless claims fall 21,000 to 434,000 J.P. Morgan, HSBC sued for silver manipulation Economy is running out of gas Don't judge a 'book' by its cover Reader Response »

Bingo! Its called hyperinflation."

- DavidRicardo | 11:27 p.m. Oct. 27, 2010

+6 Votes (7 Up / 1 Down) Find a Broker Partner Center » MarketWatch's Latest Tweets

"Benchmark 30-year fixed-rate mortgage avarages 4.23% http://on.mktw.net/9euFTO" 9:04 a.m. EDT, Oct. 28, 2010 from MarketWatch

"Weekly U.S. initial jobless-benefits claims drop by 21,000 to 434,000 http://on.mktw.net/c4yfDg" 7:34 a.m. EDT, Oct. 28, 2010 from MarketWatch

"3M singles out emerging markets as driving blue chip's sales growth; 2010 outlook tweaked http://on.mktw.net/boxzML" 6:42 a.m. EDT, Oct. 28, 2010 from MarketWatch

"Dow Chemical net beats estimate; adjusted sales up in all segments and regions http://on.mktw.net/9viFCK" 5:46 a.m. EDT, Oct. 28, 2010 from MarketWatch

"Bank of Japan offers asset-purchase details, moves up November meeting, keeps rates steady http://on.mktw.net/ajaPOK" 11:36 p.m. EDT, Oct. 27, 2010 from MarketWatch

/quotes/comstock/11j!i:dxy0 US Dollar Index Future... (DXY) /marketstate/country/US The market is open12:23:32 pm The market is closed12:23:32 pm 77.27 Change -0.88 -1.12% Volume 0.00 Real time quotes var embeddedchart231498199Chart = new EmbeddedChart('#embeddedchart231498199', NormalChartStyleNoDecimals, 190, 90, '1dy', '5mi', null, null, null, 'US:DXY'); jQuery.data($('#embeddedchart231498199').get(0), 'embeddedchart', embeddedchart231498199Chart); Add to portfolio DXY Find a Broker Create alert /quotes/comstock/21z!i1:in\x S&P 500 Index (SPX) /marketstate/country/US The market is open12:23:32 pm The market is closed12:23:32 pm 1,179 Change -3.49 -0.30% Volume 0.00 Real time quotes var embeddedchart124732823Chart = new EmbeddedChart('#embeddedchart124732823', NormalChartStyleNoDecimals, 190, 90, '1dy', '5mi', null, null, null, 'US:SPX'); jQuery.data($('#embeddedchart124732823').get(0), 'embeddedchart', embeddedchart124732823Chart); Add to portfolio SPX Find a Broker Create alert Featured Commentary » Next: Therese Poletti's Tech Tales

Therese Poletti

Tech Tales

Oracle vs SAP getting very, very personal

Next: David Callaway

David Callaway

Editor's View

Giants park rises from Web bubble ashes

Next: Tomi Kilgore

Tomi Kilgore

Stocks shouldn't blindly follow dollar

Next: Nick Godt's Market Medics

Nick Godt

Market Medics

Treat for markets, but trick for the rest of us

Next: Peter Brimelow

Peter Brimelow

Wall Street Irregulars

Critic of Goldman buys Goldman stock

Next: Rex Nutting

Rex Nutting

Money and Power

Economy is running out of gas

Next: Robert Powell's Your Portfolio

Robert Powell

Your Portfolio

Political gridlock is bad for stocks

Next: Jon Friedman's Media Web

Jon Friedman

Media Web

Guess what? NPR is liberal and elitist

Next: Lisa Twaronite's This Week in Japan

Lisa Twaronite

This Week in Japan

The original zombie feeding manual

Next: Brett Arends' ROI

Brett Arends

ROI

Tracking America's economic decline

Next: Darrell Delamaide's Political Capital

Darrell Delamaide

Political Capital

Obama as Hoover: It's the economy, not GOP

More BigCharts Virtual Stock Exchange WSJ Asia WSJ Europe WSJ Americas WSJ Chinese Financial News Online SEARCH 12:23 PM EDT October 28, 2010 /marketstate/country/us New York Open /marketstate/country/uk London Closed /marketstate/country/jp Tokyo Closed /marketstate/country/us /marketstate/country/uk /marketstate/country/jp View All Latest News /news/latest8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24038212:19p

JDS Uniphase shares slump more than 10%

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24037912:15p

Archer Daniels names GM executive as new CFO

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24037812:10p

U.S. stocks fall in afternoon trading

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24037612:07p

PMI, Allstate fall as earnings disappoint

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24037512:06p

Archer Daniels promotes John Rice to vice chairman

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24037412:06p

BREAKING

Archer Daniels Midland names Ray Young CFO

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24038112:01p

SeaCube Container shares rise following IPO

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24037212:01p

Shell, Sanofi-Aventis lead Europe higher

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24037012:01p

Updates, advisories and surprises

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24036812:00p

U.S. stocks give up early gains

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24036711:57a

Canada's TSX falls 29 points, or 0.2%, to 12,539

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24036611:56a

RIM, Potash shares drag Canadian market lower

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24036511:52a

MGM secures $486 mln via senior notes offering

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24036411:51a

Exxon Mobil buying back $5 billion in stock in Q4

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24036311:50a

Crude futures seesaw, take back $82

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24036111:47a

BREAKING

MGM secures $486 mln via debt offering

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24036011:47a

ExamWorks shares rise after IPO

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24035911:43a

Sara Lee hikes quarterly dividend to 11.5 cents

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24035811:41a

Santander's profit drops 26% on new rules

8c077dc4-5ad2-4f73-b9c3-a381c5fece05:24035611:39a

BREAKING

Sara Lee hikes quarterly dividend to 11.5c

Loading more headlines... dow /quotes/comstock/10w!i:dji/delayed 11,069 -57.06 -0.51% nasdaq /quotes/comstock/10y!i:comp 2,494 -9.63 -0.38% s&p 500 /quotes/comstock/21z!i1:in\x 1,179 -3.49 -0.30% Kiosk 1252611900000 1252612800000

Asia

LISA TWARONITE'S THIS WEEK IN JAPAN How to feed a zombie Japan didn't invent the ideas of either deflation or zombie companies, but there are lessons for the Fed in the Bank of Japan's easy-money policy. /conga/kiosk/asia.html 107719 1278554400000 1278554400000

Canada

Grow Canada Market news and investing ideas for readers on both sides of the border. "? Alberta oilsands dead duck (blog) "? Canadian health care at a crossroads /conga/kiosk/canada.html 107791 1266332400000 1266332400000

Commentary

REX NUTTING'S MONEY AND POWER Economy's running out of gas The U.S. economy is in danger of sliding back into another recession, even before we're fully recovered from the last one. /conga/kiosk/commentary3.html 107725 1247608800000 1247659200000

Election 2010

$4 billion and counting Spending on this year's midterm elections could reach almost $4 billion, shattering 2006 outlays for a new record. "? MarketWatch Election 2010 coverage /conga/kiosk/economy-politics.html 107992 1242043200000 1242691200000

Earnings Watch

Updates, surprises, moreGet the latest earnings news from companies around the world in our Earnings Watch column. "? Plus: Latest markets updates /conga/kiosk/investing.html 107741 1238889600000 1270425600000

Personal Finance

ROBERT POWELL'S YOUR PORTFOLIO Political gridlock's bad for stocks Analysts generally say that political gridlock is bad for stocks, good for bonds, writes Robert Powell. "? More in our Personal Finance section 107722 1251777600000 1251777600000

Financials

Buffett's new man Todd Combs, a little-known investment manager, is set to take over some of Berkshire Hathaway's portfolio. Who is he and what stocks does he like? /conga/kiosk/wildcard1.html 107792 1251950400000 1251950400000

Fantasy Earnings Trader Game

Shorting Lilly pays off Shorting shares of Eli Lilly pays off for three players in week 3 of MarketWatch's Fantasy Earnings Trader game. "? Week 3 roundup /conga/kiosk/wildcard2.html 107043 MarketWatch.com Site Index Topics Help Feedback Newsroom Roster Media Archive Premium Products Mobile Podcasts RSS MarketWatch on Facebook MarketWatch on Twitter Company Info Code of Conduct Corrections Advertising Media Kit Advertise Locally License our Content WSJ.com Barron's Online BigCharts Virtual Stock Exchange All Things Digital MarketWatch Community Financial News Online WSJ.com Small Business FINS: Finance, IT jobs, Sales jobs

Intraday Data provided by Thomson Reuters and subject to terms of use. Historical and current end-of-day data provided by Thomson Reuters. Intraday data delayed per exchange requirements. Dow Jones Indexes (SM) from Dow Jones & Company, Inc. All quotes are in local exchange time. Real time last sale data provided by NASDAQ. More information on NASDAQ traded symbols and their current financial status. Intraday data delayed 15 minutes for Nasdaq, and 20 minutes for other exchanges. Dow Jones Indexes(SM) from Dow Jones & Company, Inc. SEHK intraday data is provided by Comstock and is at least 60-minutes delayed. All quotes are in local exchange time.

MarketsMarkets Data is loading... QuotesQuotes Data is loading... My PortfolioMy Portfolio Data is loading... My AlertsMy Alerts Data is loading... CommunityCommunity HOT PICKS MY PICKS MY GROUPS Data is loading...

ALERT:

MarketWatch Top Stories Link to MarketWatch's Slice. 15 $(".bgCurrencyFormatting").data("bgFormat", { last: "#,###.0000", change: "#,###.0000", percentChange: "#,###.0000%" }); if (typeof s != "undefined") { s.channel = "MarketWatch"; s.server = "www.marketwatch.com"; s.prop1 = "Article"; s.prop2 = "MW_Commentary"; s.prop5 = "http://www.marketwatch.com/story/stocks-shouldnt-blindly-follow-dollar-guidance-2010-10-28"; s.prop6 = "http://www.marketwatch.com/story/stocks-shouldnt-blindly-follow-dollar-guidance-2010-10-28"; s.prop7 = "off"; s.eVar11 = "MarketWatch"; s.pageName = "MW_Article_Tomi Kilgore_05B26F3C-E1F2-11DF-B7D4-002128049AD6"; s.prop3 = "MW_Article_Tomi Kilgore"; s.prop4 = "MW_article_Tomi Kilgore_Stocks shouldn't blindly follow dollar guidance"; s.prop8 = "MarketWatch.com"; s.prop19 = "article"; s.prop20 = "05B26F3C-E1F2-11DF-B7D4-002128049AD6"; s.prop21 = "Tomi Kilgore"; s.prop22 = "MW_Article_Tomi Kilgore"; s.prop23 = "10/28/2010 12:01:37 AM"; s.prop26 = "MW_Article_Tomi Kilgore"; s.prop38 = "Opinion|Commentary|Markets/Exchanges|Economy|Commodities||US|Japan|Asia Pacific|China"; s.hier1 = "MarketWatch,Article,MW_Commentary,MW_Article_Tomi Kilgore,MW_Article_Tomi Kilgore,MW_Article_Tomi Kilgore,05B26F3C-E1F2-11DF-B7D4-002128049AD6,MW_article_Tomi Kilgore_Stocks shouldn't blindly follow dollar guidance,http://www.marketwatch.com/story/stocks-shouldnt-blindly-follow-dollar-guidance-2010-10-28"; s.hier2 = "MarketWatch,article,MW_Commentary,MW_Article_Tomi Kilgore"; s.hier3 = "MarketWatch,MW_Commentary,MW_Article_Tomi Kilgore,MW_Article_Tomi Kilgore_05B26F3C-E1F2-11DF-B7D4-002128049AD6"; s.hier4 = "MarketWatch,MW_Commentary,Article"; s.events = "event12,event18"; s.prop9 = "free"; s.prop10 = ""; s.prop11 = ""; s.prop13 = "commentary_story"; s.prop25 = ""; s.prop27 = "nomem"; s.eVar4 = "MW_Article_Tomi Kilgore_05B26F3C-E1F2-11DF-B7D4-002128049AD6"; s.eVar31 = "Thursday"; s.eVar32 = "11:00"; /************* DO NOT ALTER ANYTHING BELOW THIS LINE ! **************/ var s_code=s.t();if(s_code)document.write(s_code) }//--> DM_cat("MarketWatch > Article > MW_Commentary > MW_Article_Tomi Kilgore"); DM_tag(); document.write(''); (function () { var d = new Image(1, 1); d.onerror = d.onload = function () { d.onerror = d.onload = null; }; d.src = ["//secure-us.imrworldwide.com/cgi-bin/m?ci=us-403743h&cg=0&cc=1&si=", escape(window.location.href), "&rp=", escape(document.referrer), "&ts=compact&rnd=", (new Date()).getTime()].join(''); })(); var _bgProxyUrl = "/bgproxy/bgproxy/forward"; $(function() { BlueGrass.Runtime.openConnection({}, function(connection, type) { if (type == "connect") { BlueGrass.MarketState.setup(); BlueGrass.Quote.setup(); } }); }); $(function() { var ajaxUrl = "/story/story"; MarketWatch.Story.InitializeStory(ajaxUrl, "http://system.marketwatch.com/newscloud/docguid/05B26F3C-E1F2-11DF-B7D4-002128049AD6", "Stocks shouldn't blindly follow dollar guidance", "http://www.marketwatch.com/story/stocks-shouldnt-blindly-follow-dollar-guidance-2010-10-28"); }); window.fbAsyncInit = function() { FB.init({ appId: "283204329838", cookie: true, // these two are not required for partners that status: true, // only rely on stk plugins and don't use connect xfbml: true }); FB.XFBML.parse(); setTimeout(function() { $('#fblike').show(); }, 500); }; (function() { var e = document.createElement('script'); e.async = true; e.src = document.location.protocol + '//connect.facebook.net/en_US/all.js'; document.getElementById('fb-root').appendChild(e); }()); //$(document).ready(function() { var storywidth = $('#mainstory').width(); var maxwidth = storywidth; $('#maincontent pre').each(function(index,value) { var thiswidth = $(value).width(); if (thiswidth > maxwidth) maxwidth = thiswidth; }); var offset = maxwidth - storywidth; if (offset > 0) { var margin = 13; var blanketwidth = $('#blanket').width(); var contentwidth = $('#maincontent').width(); $('#blanket').width(blanketwidth + offset + margin); $('#maincontent').width(contentwidth + offset + margin); $('#mainstory').width(storywidth + offset + margin); } //}); window.fbAsyncInit = function() { FB.init({ appId: "283204329838", cookie: true, // these two are not required for partners that status: true, // only rely on stk plugins and don't use connect xfbml: true }); FB.XFBML.parse(); setTimeout(function() { $('#fblike').show(); }, 500); }; (function() { var e = document.createElement('script'); e.async = true; e.src = document.location.protocol + '//connect.facebook.net/en_US/all.js'; document.getElementById('fb-root').appendChild(e); }()); $(document).ready(function() { $("#commentarycarousel").mouseover(function(e) { e.preventDefault(); $(this).unbind(); MarketWatch.Panels.UpdateCarousel({ carouselDivId: 'commentarycarousel', carouselSize : 5}); }); }); $(function() { }); if(MarketWatch.Member != undefined && MarketWatch.Member.setUserLevel) { MarketWatch.Member.setUserLevel(MarketWatch.Member.UserLevel.unknown); } $(document).ready(function() { jQuery.validator.setDefaults({ highlight: function(element, errorClass) { $(element).addClass(errorClass); $(element).prev().addClass(errorClass); }, unhighlight: function(element, errorClass) { $(element).removeClass(errorClass); $(element).prev().removeClass(errorClass); } }); jQuery.validator.addMethod("checkUserName", function(value) { var userNameRX = /^[a-zA-Z0-9]+[a-zA-Z0-9]+[a-zA-Z0-9]$/; return userNameRX.test(value); }, ""); $("#registerForm").validate({ rules: { UserName : { required: true, rangelength: [4, 20], checkUserName:true }, ExistingEmailAddress: { required: true, email: true }, ConfirmExistingEmailAddress: { required: true, equalTo: "#ExistingEmailAddress", email: true } }, errorPlacement: function(error, element) { } }); $("#registerForm #username").focus(); if(MarketWatch.Member && MarketWatch.Member.init) { MarketWatch.Member.init(); } });

Email address or display name

Password

Remember me

Forgot password?

The action you requested requires a MarketWatch Community display name.

Email address or display name

Password

Remember me

Forgot password?

Community

Get your FREE membership now »

MarketWatch Community is a free service that lets you discover, organize and share MarketWatch stories with other readers.

Learn More »

The action you requested is only available to MarketWatch members.Please sign in or register.

Email address or display name

Password

Remember me

Forgot password?

Don't have a MarketWatch account?

Get your FREE membership now »

By registering, you are agreeing to MarketWatch's Terms of Service and to receiving periodic news and special offers via email about MarketWatch enhancements, products and services.

$(document).ready(function() { MarketWatch.News.setNewsBoxUrl('/news/headline/getheadlines'); }); $(function() { BlueGrass.Runtime.openConnection({}, function(connection, type) { if (type == "connect") { BlueGrass.Conga.setup(); if (typeof liveBroadcast != "undefined") { //if there are broadcasts scheduled (test should fail on any non section page) //start the live video polling MarketWatch.LiveVideo.beginPolling(); } } }); }); $(document).ready(function() { MarketWatch.DockingBar.setAlertsBoxUrl('/user/alerts/getalerts'); }); if(gomez != undefined) { gomez.endInterval("Page Load"); } ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_quotepeek231498199', { ord : 953167755, src : 'http://ad.doubleclick.net/adi/marketwatch.com/sponsor_livequotes;sym=DXY;u=^^;sz=220x32;tile=1;ord=', width : '220', height : '32', lateLoad : false, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "iframe", refreshUrl : "/cdn_content/business/re.html" }) ); ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_quotepeek124732823', { ord : 953167755, src : 'http://ad.doubleclick.net/adi/marketwatch.com/sponsor_livequotes;sym=SPX;u=^^;sz=220x32;tile=1;ord=', width : '220', height : '32', lateLoad : false, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "iframe", refreshUrl : "/cdn_content/business/re.html" }) ); ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_StoryToolsSponsorship', { ord : 953167755, src : 'http://ad.doubleclick.net/adi/marketwatch.com/sponsor_articletools;u=^^;sz=234x31;tile=1;ord=', width : '234', height : '31', lateLoad : true, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "iframe", refreshUrl : "/cdn_content/business/re.html" }) ); ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_BrokerButton1', { ord : 953167755, src : 'http://ad.doubleclick.net/adi/brokerbuttons.marketwatch.com/commentary_story;pos=1;u=^^;sz=288x40;tile=10;ord=', width : '288', height : '40', lateLoad : true, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "iframe", refreshUrl : "/cdn_content/business/re.html" }) ); ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_BrokerButton2', { ord : 953167755, src : 'http://ad.doubleclick.net/adi/brokerbuttons.marketwatch.com/commentary_story;pos=2;u=^^;sz=288x40;tile=11;ord=', width : '288', height : '40', lateLoad : true, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "iframe", refreshUrl : "/cdn_content/business/re.html" }) ); ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_BrokerButton3', { ord : 953167755, src : 'http://ad.doubleclick.net/adi/brokerbuttons.marketwatch.com/commentary_story;pos=3;u=^^;sz=288x40;tile=12;ord=', width : '288', height : '40', lateLoad : true, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "iframe", refreshUrl : "/cdn_content/business/re.html" }) ); ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_BrokerButton4', { ord : 953167755, src : 'http://ad.doubleclick.net/adi/brokerbuttons.marketwatch.com/commentary_story;pos=4;u=^^;sz=288x40;tile=13;ord=', width : '288', height : '40', lateLoad : true, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "iframe", refreshUrl : "/cdn_content/business/re.html" }) ); ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_BrokerButton5', { ord : 953167755, src : 'http://ad.doubleclick.net/adi/brokerbuttons.marketwatch.com/commentary_story;pos=5;u=^^;sz=288x40;tile=14;ord=', width : '288', height : '40', lateLoad : true, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "iframe", refreshUrl : "/cdn_content/business/re.html" }) ); ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_BrokerButton6', { ord : 953167755, src : 'http://ad.doubleclick.net/adi/brokerbuttons.marketwatch.com/commentary_story;pos=6;u=^^;sz=288x40;tile=15;ord=', width : '288', height : '40', lateLoad : true, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "iframe", refreshUrl : "/cdn_content/business/re.html" }) ); ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_DisplayAd2', { ord : 953167755, src : 'http://ad.doubleclick.net/adj/bottom.marketwatch.com/commentary_story;u=^^;sz=336x280,300x250;tile=7;ord=', lateLoad : false, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "script", refreshUrl : "/cdn_content/business/re.html" }) ); ScrillaZilla.Escort.addClient( ScrillaZilla.Client('#ad_DisplayAd1', { ord : 953167755, src : 'http://ad.doubleclick.net/adj/marketwatch.com/commentary_story;p39=;u=^^;sz=300x250,336x280,300x600,336x850;tile=6;ord=', addPeer39 : true, lateLoad : true, refresh : false, independentRefresh : false, refreshRate : 480000, refreshDomain : "", type : "script", refreshUrl : "/cdn_content/business/re.html" }) ); MarketWatch.Kiosk.setup("#kiosk", { startIndex: 3, autostart: true, refresh: true, adInRotation: false }); MarketWatch.DockingBar.setExpandableAdIframeUrl("http://images.marketwatch.com/ads/bd/brokerdock.html"); $(function() { $("#fimtracking").attr("src", "http://s.marketwatch.com/public/resources/documents/PixelTracking.html?site=marketwatch.com&zone=commentary_story&cb=" + Math.floor(Math.random()*1000000)); });

Change "yen"? to "yuan"? and things aren't so different today.

Meanwhile, the finance ministers of the world's top economies tried to defuse a currency conflict by saying countries should refrain from competitive devaluation.

Reuters Japanese 10,000-yen notes spread out next to U.S. $100 bills at an exchange office in Tokyo.

The weak dollar wasn't such a big help to stocks 17 years ago. The S&P 500 edged up just 7.1% in 1993 before falling 1.5% in 1994, although GDP growth improved to 2.9% in 1993 and 4.1% in 1994.

No wonder the U.S. continues to say it wants the dollar to stay strong.

Tomi Kilgore writes Taking Stock, a column featuring insightful analysis of equity-related topics around the world. This column originally appeared on Dow Jones Newswires.

10:52 a.m. Today10:52 a.m. Oct. 28, 2010

Bingo! Its called hyperinflation."

- DavidRicardo | 11:27 p.m. Oct. 27, 2010

"Benchmark 30-year fixed-rate mortgage avarages 4.23% http://on.mktw.net/9euFTO" 9:04 a.m. EDT, Oct. 28, 2010 from MarketWatch

"Weekly U.S. initial jobless-benefits claims drop by 21,000 to 434,000 http://on.mktw.net/c4yfDg" 7:34 a.m. EDT, Oct. 28, 2010 from MarketWatch

"3M singles out emerging markets as driving blue chip's sales growth; 2010 outlook tweaked http://on.mktw.net/boxzML" 6:42 a.m. EDT, Oct. 28, 2010 from MarketWatch

"Dow Chemical net beats estimate; adjusted sales up in all segments and regions http://on.mktw.net/9viFCK" 5:46 a.m. EDT, Oct. 28, 2010 from MarketWatch

"Bank of Japan offers asset-purchase details, moves up November meeting, keeps rates steady http://on.mktw.net/ajaPOK" 11:36 p.m. EDT, Oct. 27, 2010 from MarketWatch

Therese Poletti

Tech Tales

Oracle vs SAP getting very, very personal

David Callaway

Editor's View

Giants park rises from Web bubble ashes

Tomi Kilgore

Stocks shouldn't blindly follow dollar

Nick Godt

Market Medics

Treat for markets, but trick for the rest of us

Peter Brimelow

Wall Street Irregulars

Critic of Goldman buys Goldman stock

Read Full Article »

Comment

Show comments

Stocks Shouldn't Blindly Follow Dollar's Path

Related Articles