The US dollar is the currency traders love to hate. “Everybody knows” that the greenback is perpetually weak, a fiat currency made for shorting. This viewpoint is almost inevitably attached to hand-waving notions of money printing vis a vis the Federal Reserve, how America is going down the tubes, and so on.
But this is faulty logic and faulty economics. For one thing, quantitative easing (QE) is not money printing. It is an $85-billion-per-month asset swap, in which one form of bank reserves is switched with another. Having $85B worth of electrons added to the digital ledgers of electronic bank vaults — the ‘cash’ sitting in those vaults like stagnant pools of water — is not in the same vicinity as printing money directly. It’s not the same league, or even the same sport.

So QE itself is not actually inflationary in a “money printing” sense… except in terms of psychological impact on risk asset values. The primary effects of QE are “wealth effect” driven, via the inflation of risk assets as investors grow more aggressive in a central bank dominated, risk-neutered, low return world.
It’s possible that QE will eventually prove inflationary above and beyond risk assets, sort of, on an extreme lag basis when banks finally start lending again. But the people who have been predicting QE as inflationary should not get credit for their predictions if inflation does finally turn up on a broad basis.
Why? Because they badly misunderstood the transmission mechanism (it’s about monetary velocity, not direct ‘printing’)… they got the timing spectacularly wrong (inflation was expected years ago, and is still nowhere in sight, other than financial assets)… and if banks start lending vigorously again, they will do so against the backdrop of an improving economy.

There are a lot of huge misconceptions when it comes to macroeconomics. The idea that the US government is “broke” is another one, but we won’t delve into that now. (If you would like to read much more in-depth treatment of these topics, along with directly actionable long / short ideas,

The US dollar shows clear sign of having bottomed out in mid-2011. For nearly all of 2012 and 2013 the USD (as proxied by the US dollar index) has been putting in a massive sideways base. This lines up with multiple macro drivers, all of which disfavored the dollar circa 2011 and are now in the process of transition: