Numerator (Un)Happy Talk Season Is Here

Here is your not-very-bold prediction.

Multinationals will tell you everything is uncertain, and that foreign exchange translations hurt them. Useless information, really. What we need is a sensitivity between a 10% increase in the US Dollar, what effect that would have on their earnings next quarter or next year. Do not hold your breath, you will not get this out of them.

The securities industry is programmed to discard foreign exchange volatility. How America-centric of you. No one is disputing that the US has the world’s most flexible economy. But if your job is to sell packaged sugar in liquid or solid form, this seems kinda important. They are paying in foreign currency, so if you want to make the same number of US dollars, then you need to raise prices in those countries, in their currency.

  • US Consumers: 330 Million

  • Chinese consumers: 1.7 Billion

  • Indian (not Native-American, don’t get me started): 1.1 Billion

  • European Consumers: 750 Million

That also gives you insight on what I said this past weekend, and that it’s not necessarily negative. That also implies we are nowhere close to the ninth inning. Top of the fifth inning, at most.