Russian Ruble Breaks Below Government Set Target

The Russian government set a target value for the Russian ruble. Last week, that target was threatened. So it is no surprise that this week that target has been broken. (It is, of course, hazardous to set a target bottom for currencies -- it is sort of a challenge to break through.)

Russia has been hard-hit by the global financial crisis and by the subsequent recession. The drop in oil prices has been especially problematic for the Russian ruble, and it appears that the ruble could actually sink even lower.

Many are speculating that the ruble hasn't come close to a bottom yet, and are trying to make money as the ruble continues to lose in value on the foreign exchange market.

Barack Obama Nominates GOP Senator Judd Gregg for Commerce Department

President Barack Obama reached across the aisle to nominate Republican Judd Gregg for the top job at the Commerce Department. Considering the economic times, the Commerce Department job is important: It will play a vital roll in figuring out how to help businesses get through the recession.

Judd is potentially the third Republican to be asked to join Obama's cabinet. CNN Money reports on Obama's decision:
Gregg, a third term Republican and leading fiscal conservative, has "seen from all angles what makes our economy work ... and what keeps it from working better," Obama said at the White House. "Clearly Judd and I don't agree on every issue ... but we do agree on the urgent need to get businesses and families back on their feet."

It remains to be seen what sort of influence Gregg would have, as well as whether or not some of his ideas might be help the ailing U.S. economy.

Senate Economic Stimulus: $15,000 Tax Credit

In a stunning move this morning, the U.S. Senate just voted to include a $15,000 tax credit for homebuyers. This goes beyond the original $7,500 credit in the version passed by the House. And it is worth noting that the new $15,000 tax credit is available to any homebuyer -- not just first-time homebuyers.

Here are the details of the new tax credit:

Wow. I sure wish that they would make it retroactive to 2007 -- since I bought my home in September of that year.

Anyway, the next question is this: Will the new tax credit boost the housing/mortgage market, thereby helping the economy out of recession? Or is this measure simply something that will prolong the pain of the recession by delaying an inevitable crash?

Mexican Government Intervenes on the Currency Market

Unlike Russian leaders, who blatantly set a target level for the ruble and watched helplessly as it was broken through, Mexican leaders are quietly intervening in the currency market. Right now, like many other emerging market currencies, the Mexican peso is in a bad way -- it has fallen more than 30% in the last six months.

Mexico is being supported by the U.S., and the direct intervention may help slow the decline of the peso. Indeed, the Forex Blog points this out about the Mexican government's intervention:
At the very least, the move serves as a symbolic warning to market bears, that the Central Bank is monitoring the situation, and is prepared to defend its currency accordingly.

However, the economic fundamentals in Mexico remain weak as the global recession causes a decline in demand for products and services in emerging markets.