Daily FNArena News - FYI

Westpac Bank estimates the Australian dollar has been undervalued against the US dollar since early 2005, with fair value currently closer to US90c than US80c.

US equity markets rallied strongly last night because of what the Fed didn’t say.

Weekly musings from your editor.

Why wait when the direction is clear? The Aussie moved beyond US$0.80 last night.

Who cares about the great unwashed’s dodgy mortgages when one of the world’s biggest banks wants to merge with another of the world’s biggest banks.

The fear is that the sub-prime mortgage crisis in the US will spill over into reduced consumer spending, and recession, leading to a global recession. Is this justified?

A quiet week in Australia, but the US releases various housing market data and the Fed makes a rate decision on Wednesday.

Weekly musings of your editor. Normally on Wednesday, but this week on Friday. Because we are flexible at FNArena and we hope you are too.

This Friday sees futures and options on share indices and stocks expire simultaneously in the US. Usually the market rallies ahead of the event. Will it this week?

The Dow lost 242 points last night as a nervous market responded poorly to retail sales figures and more hysteria on the sub-prime mortgage front.