AS WE SIT here in our New York office surrounded by snow half a metre deep, such issues as how to get home from work take priority over global politics. The mundane matters of daily life have pushed the other more abstract questions into the back of our minds. The whole market seems to be doing the same thing as it is ignoring the complex and negative events that are occurring outside of its direct view. Maybe we are not being fair, as it is hard to know how to take the current events into consideration. Maybe we should hide under our desks? Or perhaps go home sick?
As an old-timer, I remember some mind-bogglingly bad times in the forex market, such as the two weeks in early 1973 when the markets closed and the dollar gapped down about 10% when they reopened. Then there was the 1974 equity wash-out. We can't forget the dollar collapse and reversal in late 1978, and the market's despair after the Saturday night massacre in 1979 when Paul Volcker showed us that he would be different from his predecessors.