Can This Market Keep Going Up?

Online, February 21, 2011 (Newswire.com) - Financial advisor Dennis Tubbergen has been discussing the decline of the U.S. Dollar against other major world currencies for months. Although the U.S. Dollar has shown some signs of strength of late, the trend of 2010 was well established to be down. Now Tubbergen explains how the current stock market rally may be tied to the devaluation of the U.S. Dollar.

Tubbergen, who is CEO of USA Wealth Management, LLC, a federally-registered investment advisory company, has been writing about this topic in his online blog and his financial newsletter, Moving Markets™. Tubbergen is a financial advisor, author and radio talk show host.

"Admittedly, the recent stock market rally has gone higher than I expected," notes Tubbergen. "One of the big reasons in my view is the slide of the U.S. Dollar over the past year. If today's markets were priced in U.S. Dollars that were worth the same amount as U.S. Dollars were one year ago, I believe that the stock markets would today have a much lower value."

Tubbergen has posted charts on his financial blog website depicting the S&P 500 over the past 9 months and a U.S. Dollar index for the same timeframe. (To view the charts, go to www.dennistubbergen.com.)

"While the charts are not exact polar opposites, in my view, they are inversely correlated with the dollar chart declining as the S&P 500 chart rises - approximately 12% over the same timeframe," explains Tubbergen. "The point is an interesting one. Pricing today's market in May 2010 dollars would have the market flat to slightly negative. Begs us to consider the question, 'Has the market gone up, or has the decline of the U.S. Dollar simply forced the market up?'"

Tubbergen believes the latter to be true.

"The Federal Reserve has confirmed that it will continue to print money to fund deficit spending through the spring of this year - for a quantitative easing total of $600 billion," concludes Tubbergen. "I think caution with stocks needs to be exercised by many investors as we near the point in time when the printing of money stops."

Dennis Tubbergen has been in the financial industry for over 25 years and has his corporate offices in the USA Wealth Management Building in downtown Grand Rapids, Michigan. Tubbergen is CEO of USA Wealth Management, LLC and has an online blog that can be viewed at www.dennistubbergen.com. His weekly talk show The Everything Financial Radio Show is simulcast on two Michigan metro stations and also airs to over 600,000 financial advisors, with recent podcasts available at www.everythingfinancialradio.com.

The opinions expressed herein are those of the writer and not necessarily those of USA Wealth Management, LLC. This update may contain forward-looking statements, including, but not limited to, statements as to future events that involve various risks and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual events or results to differ materially from those that were forecasted. Therefore, no forecast should be construed as a guarantee. Prior to making any investment decision, individuals should consult a professional to determine the risks, costs, benefits and fees associated with a particular investment. Information obtained from third party resources is believed to be reliable but the accuracy cannot be guaranteed.