One of the more bizarre aspects of the euro zone crisis is that the currency in question — the euro — has actually not had that bad a year, certainly against the dollar. Even with Greece on the brink and Italy sending ripples of fear across financial markets, the single currency is still up 1.4 percent against the greenback for the year to date.
There are lots of reasons for this. The dollar is subject to its country’s own debt crisis, negligible interest rates and various forms of quantitative easing money printing — all of which weaken FX demand. There is also some evidence that euro investors are bring their money home, as the super-low yields on 10-year German bonds attest.
Depending on how you look at it, August may not have been as bad a month for stocks as advertised. For the month as a whole, the MSCI all-country world stock index lost more than 7.5 percent. This was the worst performance since May last year, and the worst August since 1998.
But if you had bought in at the low on August 9, you would have gained healthy 8.5 percent or so.