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* The Fed fires its last bullet... * Euro breaks back above $1.40... * AUD and NZD rally... * Happy Birthday Jen... ** Fed brings rates down to near zero... Good day... The 'noise' from the street which I wrote about yesterday turned out to be correct, as the FOMC cut 75 basis points to put the Fed Funds target at .25%. The US now has the lowest interest rates in the industrialized world, even below those in Japan. The dollar lost ground quickly after the announcement and continued to fall overnight to a 13 year low vs the yen and the weakest vs. the Euro in 4 months. With both Chuck and Frank out of the office, I fielded the calls from reporters after the FOMC cut, and the most popular question asked was what the near zero interest rates would mean for the man on the street. Well it was great news for those on Wall Street, but I told the reporters that the rate cut really wouldn't have much of an impact on US consumers. After all, interest rates at 1% weren't stimulating the banks to start lending so why would .25% rates cause any change?...

* Fed cuts rates 50 BPS! * Currencies rally Big! * 3rd QTR GDP to go negative? * I.O.U.S.A. ** Heading Towards Zero... Good day... And a Tub Thumpin' Thursday to you! It certainly was a Tub Thumpin' Wednesday for the currencies, foreign stocks, commodities, and the Philadelphia Phillies! This by no means that the deep dense fog that has hung over the markets for 3 months has lifted for good... It did, however, lift for one day, and what a day it was! Oh, and the Fed did indeedly do cut their Fed Funds rate to 1%, which works out great since Fed Funds had been trading at 1% anyway! I had a reported from Dow Jones call me a few minutes after the rate cut and ask me my opinion on what the dollar was doing, which at the time was rallying back a bit... I said it looked like a classic case of buy the rumor sell the fact, that enough speculators were pushing the dollar lower ahead of the rate cut in hopes that a larger cut would be made. That, however, was not the case, and the dollar rallied... But only for about 20 minutes, and then it took a rid on the slippery slope, with the euro pushing to the 1.29 handle as I left for the day....

* Yen trades to 98! * Carry Trades unwinding hurt high yielders... * Gold rallies back to $900! * Central Bank rate cuts.... ** Coordinated Rate Cuts! Good day... And a Wonderful Wednesday to you! Well... There's a ton of stuff to talk about today, one of which is the amazing run that Japanese yen has had in the past month, but particularly the last week! No need to sneak a peak at the currency round-up, Japanese yen is trading 98.80! WOW! I could be acting like a contortionist and trying to slap myself on the back, but that would unprofessional... And besides, the rest of the currencies are taking shots to the mid-section. Anyway... Blow the horn, the Carry Trade (for yen) is dead, may it rest in peace! OK... The currencies tried like all get out yesterday to rally VS the dollar, the euro did end the day 1% higher on the day, which after the bloodshed of the past month, I'll take that any old time! I would love to go back to 2005 (not really, but for this conversation's sake I will) and pull out some old Pfennigs where I talked about all the naysayers talking about a break up of the euro... We had the NO votes from France and Denmark on accepting the European Union's (EU) Constitution, we had riots in the streets of France, we had rising interest rates in the U.S. and dozens and dozens of naysayers called out the euro and said it would collapse under the weight. I said then, and I'll say now... HOGWASH!...

* largest one-day move up in the euro! * largest one-day move up in Oil! * Gold and Silver rebound! * Renminbi finally moves! ** Some Healing... Good day... And a Terrific Tuesday to you! I heard from one of my two sisters that live in the Houston area yesterday. They rode out the Hurricane together, have some damage to her house, and is still without electricity. I can't imagine what that's all like. But they are both safe at that's what's important at this point. Well... The euro had it's largest one-day move upward VS the dollar since its inception in 1999, yesterday... We've seen some profit taking in the overnight markets, but just for good measure... I think it appropriate to show that the euro reached 1.48 yesterday... That was a 3.5 euro move, and after falling to a low of 1.3869 on 9/12 (before bouncing big that day), the euro has now recovered about 7%... I would call that "some healing"......

* A bounce in the euro overnight... * Iran tests long range missiles... * Japan's Machine Orders soar! * Is Big Ben giving us a hint? ** Fighting Deflation Instead of Inflation? Good day... And a Wonderful Wednesday to you! Things settled down a bit yesterday, with the rumors of bailout for Fannie and Freddie Macs fading, and some awful Housing data being swept under the rug. The dollar gained back the ground it had lost to the euro the previous day, and Japan printed a very strong Machine Orders report... And now Iran tests long range missiles... All that and more as we begin our Wednesday... OK, front and center this morning... The Housing data from yesterday. Since the media decided to sweep this under the rug, I thought I would make certain that at least Pfennig Readers were aware of the rot on the Housing vine. The index of Pending Home resales fell -4.7% in April, a much larger decline than the "experts" forecast. I think what you're seeing here is simply that would be buyers are holding off as they expect further declines in prices.....

* TIC's look funny... * Germany's ZEW is weaker... * A note from the Washington Post! * Tons of data today... **Calling Out The Fed... Good day... And a Terrific Tuesday to you! Well... Someone from the Washington Post is a Pfennig Reader (I think!), as there was a great article in the paper calling out the Fed on their "rate hike" rhetoric... I'll give you snippets of that, and a snippet from my friend, the Mogambo Guru, along with the usual currency talk, on this Terrific Tuesday... Ready, set, let's go! Front and Center this morning is the dollar getting sold all day yesterday, as the euro recovered all the way to 1.5515 in the overnight markets. Unfortunately, the single unit was stopped in its rally tracks by an awful printing of German Investor Confidence, as measured by the think tank ZEW... German Investor Confidence dropped to the lowest level in 15 years this month, as rising inflation is eating away at the economy. I don't expect this report to put too much a dent in the single unit's performance today, but for now it has slipped back below 1.55......

* Softer CPI? * Foreclosures on the rise... * Just wishing on a star... * Jim Rogers on a Wednesday!...

* Euro hits 1.52! * Bernanke "endorses" a weak dollar! * Jimmy Rogers on a Fantastico Friday... * A perfect storm for the dollar......