SOME readers will have noticed that I have turned almost bullish in my market commentaries recently.

Last week, I wrote in this blog that I did not believe that the United States was slipping back into recession. The only problem was the growing unemployment which might be structural in nature and needed time to be sorted out.

In any case, the August jobs report confirmed what many of us privately believe – that the US economy is growing, but at a slower rate than expected. This is a far cry from the financial Armageddon which some economists are predicting.

So rather than the dour headlines that have been spooking sentiments recently like "lost decade for investors" and "markets in for seven lean years", I am actually quite inclined to think that it will be business as usual soon.

And I can even put a date to it – November – as the outcome from the mid-term US Congressional elections helps to clear the grid-lock that is paralysing the US economy and generating the uncertainties which is keeping investors on the sidelines.

Some may ask: Why must investors pay so much attention to the United States ?

The conventional answer is that it is the world’s largest economy. But I believe that the more important reason lies in the immensely profitable but highly risky US dollar carry trade which big traders indulge in.

As the US Fed slashed interest rates to zero and printed almost US$2 trillion to try to jump-start the US economy back to health, the greenback has steadily weakened in value against all other major currencies.

It has become a no-brainer to borrow in US dollars to try to take a punt in other assets, with the borrower making gains from the appreciation of his asset, and foreign exchange, as the greenback weakens.

One sign as to how huge this trade has become is the explosive growth in foreign exchange trading in the past two years, even as the global economy was mired in a slowdown spawned by the mortgage crisis in the United States.

Even as their lending slows down in the US and Europe, global banks have been doing a roaring business trading currencies, as hedge funds get in and out of the various currencies when they borrow and repay their US dollar loans to take punts on other markets.

Their activities have lured other traders into the fray – the algos, for instance, that try to make money from tiny movements in prices.

The outcome of the US mid-term Congressional election may have a bearing on the greenback, and this will remove some of the uncertainties we are seeing in global stock markets now.

This morning, I wrote a Cai Jin column to highlight the possibility of a tech stock rally triggered by the smartphone revolution.

Smart companies like Intel are already gearing for the challenge by snapping up businesses which can add an edge to their technologies.

Not surprisingly, even SingTel may be jumping into the fray, with a report that it was mulling a bid for UK’s Cable & Wireless.

If it successfully buys up C&W, SingTel will be turning history on its head.

During the dotcom boom 10 years ago, SingTel’s bid to buy Hong Kong Telcoms was derailed by C&W’s decision to sell its majority stake in the HK telco to PCCW.