Donald Trump predicted dire consequences for the U.S. dollar if the Federal Reserve launched another round of quantitative easing, and now QE3 has arrived.
The U.S. won’t be able to pay down its debt if Fed Chairman Ben Bernanke “goes wild” with more stimulus, Trump told CNBC in July.
“The fact is that the country owes $16 trillion, and we just can’t keep doing this,” Trump said. “The dollar is going to go to hell.”
PowerShares DB US Dollar Index Bullish (NYSEArca: UUP) has been moving lower since July on expectations the Fed would unleash QE3. [Dollar Weakens on Fed Speculation, Moody’s Warning]
UUP has fallen below its 200-day average decisively. It’s the first sustained break under the technical indicator in nearly a year.
The ETF tracks the dollar’s movement against a basket of currencies.