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A Dollar Warning From Asia

Discussion in 'The Economy' started by Tropo, 18th Nov, 2009.

  1. Tropo

    Tropo Well-Known Member

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    Many of these nations peg their currencies, formally or informally, to the greenback.
    So they are getting a huge dollar liquidity kick from the carry trade, in which people borrow U.S. dollars at exceptionally low U.S. interest rates and invest them for higher returns elsewhere.
    As a result, Asia's stock markets are outstripping U.S. and European bourses by a country mile.
    Shanghai alone is up nearly 80% this year-to-date.
    Hong Kong property is climbing through the roof, with one recent apartment sale mooted at $57 million.
    Foreign investors are even getting enthusiastic again about one of the most corrupt emerging markets around—Indonesia—and dubbing it the "new China."
    more...How the US's Falling Dollar Affects Asia - WSJ.com
     
  2. Chris C

    Chris C Well-Known Member

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    I thought this comment was hilarious - but so true:

    "Tim Geithner has been calling for a "strong dollar" but also for "market-oriented exchange rates." This mantra from the George W. Bush era has come to be understood as code that the Treasury wants a weak dollar."

    Now the only question is, what to do with out humble AUD's?
     
  3. Simon Hampel

    Simon Hampel Co-founder Staff Member

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    Two words: consumer electronics :D
     
  4. Billv

    Billv Getting there

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    I think we should see this as an opportunity to do something useful with our money. Do we know of any US companies with sound fundamentals ?
     
  5. Chris C

    Chris C Well-Known Member

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    Yeah... the ones that derive most of their income from abroad and aren't paid in USDs.

    :D