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Weakening Dollar
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tanzq83
Member |
13-Sep-2009 17:27
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Looking from the current situation in US, apparently it seems that the world have limited options but to allow the dollar to continue to weaken. Weaken dollar from high amount of deficit (and perhaps increasing), means US will have cheaper labour, and encourages exporting ~ this seems like a strategy by the US government to improve on their situation for the next 3-4 years. International consumers less the Americans, are likely to be badly affected as dollar weakens. In the process of weakening dollars, investors seek for withdraw from the equities positions and invest in commodities ~ thus we see a price hike in gold and maybe even crude oil ~ perhaps this is a way to headge against such situation ~ but cause another round of inflations worries. There are calls and suggestions to peg international curriences against other more stable ones such as yuan (as chinese RMB seems to be doing well as the economy is striving under tough condition, if im not wrong) ~ what are your opinions on this move? Should the IMF even consider this move, as we are certain to see US going through really tough condition in the coming 3-4 years, as according to Tim Geither. Could the US dollar be the cause or even the catalyst, to the much prophesised 'double-dipped' in the market? Another point to observe shall be the possibility of increasing debt from the nation although Geither had already claimed that the nation will do its best to "NOT TO INCREASE ANY COST and working within their budget". Will the healthcare reform not increase debts which will end up causing the dollar to weaken further? Seems like US is pulling the entire world down.. really need experts advise on this.. :) |
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Hulumas
Supreme |
13-Sep-2009 15:34
Yells: "INVEST but not TRADE please!" |
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USD stable is good for the world, USD weak is bad for the world except USA, USD strong is better for the world but worse for USA.
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thomas_low
Veteran |
12-Sep-2009 22:06
Yells: "Gong Xi Money Made" |
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Weak dollar is not directly related to bear market, it means US goods or goods quoted in US dollars are chaeper and create more work, jobs, business and revenue and share price. So cant simply assume gold up share prices down. What you can assume is when oil is up, inflation will go up after that. Silver also up, can you say consumption of silver in up and means good business? The current rise is speculative, the USD is deliberately keep low to stimulate the economy, people get back their jobs and the president fulfilled his election pledges, the overall effect of USD down maybe a real stimulus for the US economy. Also USD has been flowing into foreign markets, so drive down USD also. USD changed into EURO and gold, hence gold price up, purely speculative rather than waiting for the next plunge...Me no economist but this is my view, maybe totally wrong but try out this scenario. | ||
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Livermore
Master |
12-Sep-2009 20:06
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Hope US dollar continue to weaken | ||
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tanzq83
Member |
12-Sep-2009 18:56
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The USD dollar has been weakening this week and investors appear to be freeding to safe heavens by buying GOLD and related commodities, as the price for GOLD surged above USD1000. Could this signal be an admonition to the beginning of another bear market, just like what we witnessed during Jul08, Feb09? How can we benefit from the weakening dollar this time round? Will the dollar continues to weaken (until which point will there be a turn-around?)? What are the consequences of weakening dollar (i.e. cost of japanese cars will surge due to raising yen??) Hope that you can share with me your strategy on tackling this issue. |
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