Invest Skeptically

As a Canadian who invests heavily in U.S. stocks it alarms me to see the value of the USD slide against the CAD (and every other major currency) so far and so fast. Is this a sign of overall bearishness towards U.S. assets? Although many large cap names derive significant revenues from overseas, I’m finding ever alarming signs of doom and gloom in the U.S.

• The economy at large
  In his Blue Magic video Jay-Z flashes 500 Euro bills instead of the more traditional Dollar. Truly there is no single economic indicator more weighty than this.
• U.S. residential real estate
  While browsing the web today I came across this blog entry about rising “real estate owned” in Orange County. They’re foreclosing on mortgages in the O.C.?!
  
• The financial system
  There has been much, duly deserved, positive commentary of the bail-out plan for U.S. structured credit vehicles. However, I think it’s noteworthy that the final list of institutions who were able to step-up to the plate (Citi, BofA, JPM) all have very large commercial banking operations. Where were the money-centre banks? Perhaps they’re in so deep that they aren’t in a position to offer market stability. Contrast this trio to the broad consortium of counterparties that bailed-out LTCM.
• The future
  There was a PBS documentary on the other night about the “space race” and I was reminded of how fast the U.S. can move when they really put their minds to it. They have contributed as much as, if not significantly more than, any other modern nation in the development of science and math into techniques that alter the course of civilization and increase standards of living. But where does the education system focus its energies nowadays (remember that I’m an outsider and that I only see the country through the eyes of the American media headlines)?: abstinence-only sex-ed programs, breathtakingly inane battles over intelligent design, and charter schools that try to fill the void left by a public education system that is viewed as failing.