Morning Reading – Tuesday, March 22, 2011

The Slope Of Hope: Currency Crossroads

The US dollar has been in a free-fall for pretty much all of 2011, but there’s a chance it might be reaching a crossroads. The EUR/USD graph below shows that the surge in the Euro’s value is reaching (1) a descending trendline; (2) a Fibonacci fan line (3) the most recent medium-term top, from November 3 of last year.

FT Alphaville: The wrong kind of inflation, the ironic austerity

Update: The inflation number’s out — and higher than expected. February saw CPI at 4.4 per cent, RPI at 5.5 per cent, which rates are at highs not seen since 2008 or 1991 year on year, respectively. The ONS said that clothing, energy and housing costs triggered this month’s upward shift.

FT Alphaville: Japan: Supply chain update

In terms of the macroeconomic impact in the aftermath of the earthquake and tsunami, and amid ongoing efforts to contain radioactive leakages at the Fukushima nuclear plant, Adachi says the immediate concern is the supply chain disruption.

FT Alphaville: Japan’s supply-chain loss, Europe’s gain?

The supply chain issue affecting Japan appears to be getting much worse than initially expected.

FT Alphaville: Why no Canadian, Australian housing busts?

Both these countries have had rather high mortgage debt to GDP ratios and there have been some rumblings about frothiness in the two markets for a while now. There’s even a whole website dedicated to Canada’s (nascent?) housing bubble.

Wired: Possible Early Warning Sign for Market Crashes

Complexity researchers who study the behavior of stock markets may have identified a signal that precedes crashes.

They say the telltale sign is a measure of co-movement, or the likelihood of stocks to move in the same direction. When a market is healthy, co-movement is low. But in the months and years before a crash, co-movement seems to grow.

The Big Picture: Are huge earthquakes linked?

“What is clear is that for the 6.2 years since 2004, there have been more great earthquakes around the world than in any 6.2-year period throughout the 110-year history of seismic recordings.”

-Thorne Lay at the University of California, Santa Cruz.

Bloomberg: Nuclear Plant Contaminates Sea After Damage to Fuel Rods

Radiation leaked into the sea from Japan’s crippled nuclear plant, raising concern that seafood may become tainted, while the site’s operator moved closer to restoring power to critical cooling pumps.

Climateer Investing: Ambrose Evans-Pritchard: “Safe nuclear does exist, and China is leading the way with thorium”

A few weeks before the tsunami struck Fukushima’s uranium reactors and shattered public faith in nuclear power, China revealed that it was launching a rival technology to build a safer, cleaner, and ultimately cheaper network of reactors based on thorium.

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