Dear Extended Family,

A few important observations:

1. The Euro Zone financial and general business system has been bailed out at the rate of 6% of their 2007 GDP (2007 last reported).

2. The US financial and general business system has been bailed out at a rate of 5% of 2007 GDP (2007 last reported).

3. The US dollar has appreciated from the low of .72 to the high of .89 on the USDX.

4. That represents a 26.3% appreciation for the dollar versus the euro.

5. The difference between 5% and 6% can be argued as a 20% increase in percentage of GDP (not absolute bailout funds) higher in the Euro Zone.

6. Rate of interest returns in the Euro Zone are on average more than 100% higher than the US but that is not a factor because it does not serve the interest of the dollar longs. This keeps the media quiet.

Conclusion:

Algorithms and technical short term dollar flows are the very short term of the dollar rally.

Regards,
Jim