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One of the great things about markets is how they are always changing. They never cease to surprise. But the market, as sly as it is, sometimes tips its hand.

While killing some time at the JFK airport a couple weeks ago, I grabbed a copy of Bloomberg Markets magazine and perused it over breakfast. There was one story that struck me titled “Time to Head Home for Some Manufacturers.” The basic gist is that American manufacturing is more competitive than most people think. But the manufacturers themselves are starting to notice. And so some of them are opening up new plants in the US or relocating far-flung plants back home. The math is pretty simple. The big lures that sent them abroad — cheap labor and cheap fuel — are no longer so attractive. As I noted on Feb. 3, the wage gap has shrunk. Wages in China and other overseas markets have gone up a bunch while US wages have stagnated. Cheap fuel has long since expired as a reality. Oil is the big factor and crude oil averaged north of $100 a barrel last year for the first time ever. But natural gas is another lure to come back to the US. In China, for example, natural gas prices are twice what they are here.

There is more: The US dollar has lost a quarter of its purchasing power since 2002 against a basket of 20 major currencies. That makes US assets and talent cheaper compared with similar assets and talent overseas.

The raw costs are only part of the equation. There is the soft stuff to consider as well, things like intellectual property risks and the fragility of supply chains. The Japanese tsunami and floods in Thailand caused major disruptions for manufacturers. And the US itself is still the world’s largest market. Therefore, the thinking goes, it could be better to make things closer to the customers that buy them.

Researchers at Gartner predict that 20% of the goods made in Asia for the US will shift back to the US by 2014. Surveys of manufacturers show many are considering moving operations back to the US.

Read more: Made in America…Again!

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It’s going to be the biggest fire sale in history — and it begins in 2012.

Europe’s banking sector holds 2½ times as many assets as the U.S. banking sector. It’s huge. And it’s in big trouble. Europe’s banking sector needs cash — mountains of cash.

As a result, it will have to sell more than $1.8 trillion of assets, which will likely take a decade to work through. For perspective, it sold only $97 billion from 2003–10. “The list of asset sales is the longest I’ve seen in 10 years,” says Richard Thompson, a partner at PricewaterhouseCoopers in London. Knowing how these things work, the final tally could well be double that. The world has never seen anything this big before.

Where will the cash come from?

This is our opportunity. There is no better, more-reliable way to make money than to buy something from someone who has to sell. Bankers are the best people in the world to buy from. Believe me, I know.

I was a vice president of corporate banking for 10 years before I started writing newsletters in 2004. I would get at least three or four requests every year from some investor group asking if we had any assets we were looking to unload. Why? Because they know banks are stupid sellers.

I once had a big real estate deal go bad on me. But I knew I was covered by good collateral twice over. You’d never know it based on the pressure I got to get rid of the thing once the borrower stopped paying and the bank took the asset. I knew, given a little time, I could sell the property and make a bundle for the bank. But the folks at the top didn’t want to hear it. They wanted that bad loan gone. They wanted to wipe it off the books fast.

So I sold it quickly, basically at fire-sale prices. It was still the most-profitable loan the bank made that year, because I got a price a good 35% above the loan amount. But the group I sold it to — which could’ve been more patient in marketing the property – flipped it again and made an easy 50% above that. The bank left a lot of money on the table and knew it — and didn’t care.

Read more: The Biggest Fire Sale in History

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Make You Own Pot Of Gold!!!

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The currency markets were fairly calm yesterday, with the dollar pretty much unchanged from the levels I reported in yesterday’s Pfennig. There really wasn’t much new information to push the dollar one way or the other, and the news scrolling on the currency trading screens mainly rehashed concerns over China’s slowdown.

As I reported yesterday, a couple of the big raw material suppliers to China warned the markets that they were reducing their projections of demand as China’s economy slows. This had an especially dramatic impact on the currencies of commodity exporters such as Australia, Canada and Brazil. Concerns over China also spilled over to the high-yielding currencies such as the New Zealand dollar (NZD) and South African rand (ZAR), as traders worried global growth would slow. But the initial sell-off of these commodity-based currencies reversed later in the day, and this reversal continued overnight, bringing all of them back to levels they were trading at before the Chinese growth worries hit the markets.

The euro (EUR) traded lower yesterday morning, losing against both the U.S. dollar and pound sterling (GBP) as data showed European economic growth is continuing to slow. The German statistics office said producer prices climbed just 0.4% in February, compared with a 0.6% rise the month before. The median estimate from analysts taken by Bloomberg predicted a 0.5% increase, so the drop was greater than expected. The European economies are struggling to stay in a growth mode, and economists are almost unanimous in their opinion that Europe will slip back into a recession later this year…

Read more: Gold Demand Drops as Indian Jewelers Close in Protest

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