The Tuesday after Labor Day is rarely a happy day for school age children, but this year it was no picnic for investors either. In fact, chatter on the floor suggested this Tuesday after Labor Day may be remembered as the day the game changed.
Largely, the talk was triggered by a drastic move by Switzerland, which – in an effort to protect its exporters - unilaterally set a floor on the franc's exchange rate against the euro at 1.2, roiling currency markets.
The move forced a re-allocation effectively calling into question the Swiss franc as a safe haven. ”Everything is now in play,” muses Fast trader Joe Terranova. “This changes the money flows around.”
And the big issue – the game changer if you will – is what happens to the US dollar in the wake of these developments. “The dollar may recapture some of its lost luster,” Terranova explains.