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Currency Wars...

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Super Contributor
... Who will emerge as the winner? Here what's happening: 1. US QE2 main purpose is to devalue the US$ - this will ease debit paid in US. 2. Japan trying hard to devalue Yen - hence today's move on interest rates 0% and more QE. 3. Europe is confused - so they are doing nothing - they need investors in their trouble southern Europe bonds. 4. Uk follows big daddy US - i.e. QE pound down. 5. All emerging market currencies are ralling including Rand/$ (they are to small to try and devalue their currencies) 6. China is staying put... they like $ peg to Yuan... they will not budge to US or world Pressure. In the medium term: The winner will be China - more cheap goods heading globally. Long term: No winners
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Valued Contributor
long term the winner is cheap holidays for me ..
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Super Contributor
yep, cheap buys from Amazon, but that world wide investment trust i'm invested in is turning into a crock of shaite though. so, i'm pulling in that dead in the water investment and it's going into local equities with a some exposure to the rest of the world - BAT's, Naspers and Bidvest. thank you very much.
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Super Contributor
Long term view blurred by dizzy feeling from probable spirals. A long term stayer is inflation within the QE economies. For them gold should be very good insurance; maybe some more malema speak will kick the Rand gold price into play.
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Super Contributor
Yep, Central banks are flooding the globe with cheap money, short term development nations might experience deflation but medium to long term these policies will result in high inflation or even Hyper inflation. Then the real pain will start.
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Super Contributor
$/Yen lost all this morning's gain! What does this tell you? Back at 83.35
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Super Contributor
Japan has been doing it for decades, hence the lost decade, and the only thing they're sitting with is deflation. Don't use Zim as a benchmark for hyperinflation. First world countries actually have a process for QE. The US, just like Japan will sit with deflation rather than inflation, and without China giving in to the US demand on free floating the Renminbi, they will have no ammunition left to fight it.
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Super Contributor
just one thing....if China owns all this new dept we taling about and they have currency pegged to the dollar. How exactly does this help with dept repayments???
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Super Contributor
1. US exports more, imports less 2. US uses printed money to pay interest to Bond holders. 3. All is well until the system overheats from too many $ in the world economy. !Boom! But China is mess the US' game plan.
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