This “King” is a Brutal Killer A two-decade high for the dollar … why its strength is so bad for earnings … the second way a strong dollar hurts stocks … relief from Europe? That’s the thing about bear-market rallies – they’re very convincing. Yesterday, we watched the last few drops of the summer bear-market rally swirl down the drain, as the SP set a fresh low for 2022. As I write on Tuesday, this morning’s rally has fizzled. All three indexes were up roughly 1% (the Nasdaq was up 1.6%). But they’re all in the red at the moment, though who knows where they’ll be when you read this. U.S. stocks face a laundry list of problems. But let’s zero in on one in particular – one that was responsible for billions of losses in Q2 earnings. For example, this problem cost IBM $900 million in Q2. And the tech giant expects the issue will shave about 8 percentage points off of its Q3 results. For Pepsi, its Q2 earnings were 2% lower than they’d have otherwise have been because of the problem we’re about to discuss. Johnson Johnson’s Q2 revenues took a huge hit, but the bigger issue was its full-year forecast.