The semi Bullish case for the USD

Have you noticed that US equitie indexes went up with the decline with the USD and went down with signs of strength for most of the last few years? Will that trend reverse?  Will the signs of higher yields in the bond market, aka selling of treasuries or overwhelming supply,  without a strong demand bring the USD strength?   My favorite free author of late on the equity market is SyHarding at the StreetSmartreport via >www.decisionpoint.com>favorite advisors>StreetSmart. 

When Germany reunited they had a strong currency due to their high reunification costs and needed to attract funds to their bonds, high bond yields attracted those funds.  When there was a currency crisis in Asia in 1998, investors sought the USD, and the uber strong parabolic equity market of the 1990s, especially the Nasdaq, thanks to the internet ecommerce, brought in a huge USD demand (and strong capital gains income to help make the Clinton look like a fiscal conservative and Bush and Republicans didn’t keep spending down when the capital gains income cratered, another topic another day. )  So we will see if the USD will rally some more from here.  When states, like California have very poor business environments, and when the USA has huge unfunded deficits like the entitlements for social security and medicare are pretty well known for their USD bearish fundamental factors.   So lately, the Greece bond downgrade has weighed heavily on the Euro of late, hence some strength the USD .   These are not the only sovereign debt issues out there either, with plenty of news stories making it sound like Keynesian economics is all the rage in governments, especially our own USA.

According to the Seasonal sections of the Sy Harding’s work, the second year of a presidency is always bullish for the stock market in the past since the end of WWI.  Anyone with a Stock Traders Almanac will see that a Republican Congress and a Democrat president has been the best winning combination for stocks in the past.  Is that what this market is pricing in?