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NEW YORK (ETF Expert) -- The U.S. dollar has certainly lost value since the Federal Reserve began printing greenbacks to purchase U.S. bonds.

On the other hand, most of the damage occurred at the onset of the Fed's quantitative easing program(s). Since the euro came under extreme pressure during the sovereign debt crisis of 2011, and since Japan's campaign to radically devalue its currency (yen) in 2012,

PowerShares DB Dollar Bullish


has been remarkably stable.

On the other hand, current market participants have sniffed out a highly probable outcome over the next six months. Specifically, the idea of the Fed slowing down its bond purchases (a.k.a. tapering) is preposterous.

In my July 30 feature,

Bond ETFs Could Shock Pundits in the Months Ahead,

I expressed serious doubts that the Bernanke-led Fed would begin tapering in 2013. I wrote:

Who genuinely believes that unemployment is falling at a rapid enough clip to warrant a change in direction? Who actually sees the Fed's inflation measure rising at a fast enough pace to justify a policy modification? Last but not least, why would Bernanke want to rock the apple cart in any shape or form prior to his January departure?

Most experts believed that I was way off base. In particular, my suggestion that the 10-year yield would likely be closer to a 2% to 2.25% range than a 2.75% to 3% range by year's end seemed like a long shot. Equally controversial, I advocated that taxable account owners revisit municipal bond opportunities like

iShares National Muni



Today, however, a few more folks may be coming around to my way of thinking. The number of new jobs have been steadily dropping for months. The budget debate is only getting started. If Janet Yellen replaces Bernanke, the Fed may even try to print more money to buy bonds rather than pull away from the project.

The 10-year yield is declining...

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Courtesy of

...the U.S. dollar via UUP is testing 2011 lows...

Courtesy of

...and the prospects for munis in the intermediate term appear to be brightening.

Courtesy of

I am not suggesting that investors abandon the stock ship for the supposed safer shores of fixed income. In actuality, the electronic printing of dollars to buy bonds is benefiting stocks and commodities as well. In particular, the economies of China and Europe may be recovering with less overt currency devaluation or obvious rate manipulation.

It follows that funds like

iShares Australia


may benefit from greater internal demand on the mainland. Additionally, broader-based international assets like

Vanguard All World excl U.S.



iShares MSCI EAFE Small Cap


may figure prominently in any year-end running of the bulls.

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This article was written by an independent contributor, separate from TheStreet's regular news coverage.

Disclosure Statement: ETF Expert is a website that makes the world of ETFs easier to understand. Gary Gordon, Pacific Park Financial and/or its clients may hold positions in ETFs, mutual funds and investment assets mentioned. The commentary does not constitute individualized investment advice. The opinions offered are not personalized recommendations to buy, sell or hold securities. At times, issuers of exchange-traded products compensate Pacific Park Financial or its subsidiaries for advertising at the ETF Expert website. ETF Expert content is created independently of any advertising relationships. You may review additional ETF Expert at the site.

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