Dollar Going To ######, What Should I Do?

[Khun Jean]

Harmonica,

You are absolutely right. People tend to buy when prices are high and sell when they are low. If you say it in one sentence like that it sounds ridiculous but it really happens. All of the time.

The best investments were those when my emotion told me not to buy but hard numbers said buy, buy buy.

I suggested it before why buy euro's or whatever currency when your own currency is at its lowest. Just wait it out. My euros are doing the opposite, they get changed for 60% baht (i use most of it ) and 20% dollars, the rest stays in euro's.

Mister Thaksin is building in my opinion an economic bubble so i guess in a few years the baht will be around 100 to a euro. That would be great for Europeans retiring here.

Dollars get traded back for euros when the euro/dollar is 1 / 0.9 or better. I just wait, even years if it is necessary. It surely beats interest rates for savings. I buy dollars when they are 1 / 1.10 or cheaper.

Just an opinion, worked so far, never know if it will work in the future.

[LivinLOS]

Contraian investment strategy is one I have followed for a while.. However Please give me one fundamental reason why the USD dollar will improve (not sentiment of cause everyone thinks it wont) ??

Against that reason I will stack..

Rising interest rates...

Massive personal (non home) debts...

Massive house price 'bubble' (and consider the interest rates point 1)...

Massive home equity debt...

Massive trade deficits...

Massive government deficits...

Alternatives for reserve currency...

Ongoing conflicts (Iraq, terrorism in general)...

Foriegn governemtns adjusting policies of propping up the dollar which has been happening for the last couple of years..

I could go on... So what is going to counter against these factors ?? I think 2005 could easily lead to 2:50 USD/GBP and 1.80 ESD/EUR even 850 - 1k USD/GOLD Oz (probably 2006 on this once the panic sets in)..

[britmaveric]

Contraian investment strategy is one I have followed for a while.. However Please give me one fundamental reason why the USD dollar will improve (not sentiment of cause everyone thinks it wont) ??

Against that reason I will stack..

Rising interest rates...

Massive personal (non home) debts...

Massive house price  'bubble' (and consider the interest rates point 1)...

Massive home equity debt...

Massive trade deficits...

Massive government deficits...

Alternatives for reserve currency...

Ongoing conflicts (Iraq, terrorism in general)...

Foriegn governemtns adjusting policies of propping up the dollar which has been happening for the last couple of years..

I could go on... So what is going to counter against these factors ?? I think 2005 could easily lead to 2:50 USD/GBP and 1.80 ESD/EUR even 850 - 1k USD/GOLD Oz (probably 2006 on this once the panic sets in)..

<{POST_SNAPBACK}>

Hmmm pretty much described Europe as well as the rest of world.

[PeaceBlondie]

Part of the price of any widely traded commodity, including foreign currencies, is simple supply and demand at the retail and wholesale level. I don't understand all of this by any means (the experts aren't telling their secrets). If the dealers themselves are short on a given paper, they'll pay more for it (and pass that price on to the buyers).

Then there's the big factor of speculators, like some of the folks commenting on this thread.

There are several other factors, and it's surprising how somebody with a master's in economics may say, "Oh, I didn't study that at university."

[LivinLOS]

Hmmm pretty much described Europe as well as the rest of world. 

<{POST_SNAPBACK}>

Hmm well in some agreement with you, hence my desire to be in commodites outside of fiat currency totally and to put my assets into stores of wealth that have been tradeable for 1000's of years instead of 30 (USD dollar unbacked by gold circa nixon era) or only a handful like the euro... Ones I migth add that cannot be inflated out of existence or printed to requirements.

That said Europe does not have quite the insane levels of personal, government, or trade debt that the USA does.. It also is benefiting from the anti US shift in reserve funds and does not have the same security / terror issues as the US (though the world is changing in its manner of conflict as Alvin Toffler predicted in the 70's)..

The UK especially is quite used to maintaining higher interest rates (look what has happened to IRL's property market since coming into the Euro and getting Euro interest rates after historicaly having UK style rates.. Can we say 'bubble') and so seeing 5% repayment rates in the UK is likely to cause less repossesion %'ages that it will if and when it happens in the USA.

[Harmonica]

LivinLOS,

You've put forth some very interesting analysis. I applaud your effort at figuring out the markets.

You asked me for "one single fundamental reason why the Dollar could go up" -- well, there is none, not a single fundamental reason.

However, therein lies the trap, for I believe you're using the wrong tool.

And for others here who have been quoting CNBC, WSJ, Nation, Bangkok Post and a host of other mainstream Media financial experts, all I can say is, you will never win following their advice because their job is simply to keep the game going forever and, if you get smart, it kind of defeats their modus operandi. They are not your friends. They should be avoided at all costs. Their only valuable service is raw DATA. This is what you use and then, go do your own analysis.

Here's a nugget for starters:

"At major turning points the Media and therefore the general public, aka the HERD, is ALWAYS on the wrong side of the market and leads the public enthusiastically over the cliff! It rarely acknowledges the error until the reverse move is well underway and a new uptrend has been establlished; then it latches onto this and the cycle repeats"

###### em, I say. Start then and you have a shot.

[Harmonica]

LivinLOS,

For the fellow who cut and pasted the Thai Baht's recent history against the USD, making the point that the Baht is now back to where it was way back then, in the vicinity of 39, all I can say is "Hello!"

It is correctly stated but ... highly misleading and reeks of laziness. Why?

Because fellows like me played that up/down move twice, went LONG on the up and then SHORT on the downleg. The profits were gorgeous. If you wait another 40 years the Baht might end up again back at 39 and this fellow could again state, "look Ma, there's been no progress."

That's not the way to play; much akin to always saying, "This is Thailand" -- one just can't win in the long run if one has such an attitude.

If my tone was a bit severe, I know you'll bear with me, for to be wishy-washy with these basics, is to lose out right at the starting gate!

Regards

[Harmonica]

Ravisher,

Agreed. We are the "little" guys and all we're trying to do is get a small share of the pie by keeping an eye on the "bigwigs" and trying to figure out their moves and what makes them tick.

You've inadvertently opened the door to the field of Technical Analysis. This is a field of market analysis wherein the FOOTPRINTS of the players large and small are visible. One can therefore state that it matters not what they say, only what they buy and/or sell and this aspect shows up in spades on the volume charts and specifically for the USD, in volume, open interest and net positions for the really bigshots, namely the Commercial Hedgers.

These cats ARE the bigwigs and I never go against them in my plays.

[thaistick]

Ravisher,

Agreed. We are the "little" guys and all we're trying to do is get a small share of the pie by keeping an eye on the "bigwigs" and trying to figure out their moves and what makes them tick.

You've inadvertently opened the door to the field of Technical Analysis.  This is a field of market analysis wherein the FOOTPRINTS of the players large and small are visible.  One can therefore state that it matters not what they say, only what they buy and/or sell and this aspect shows up in spades on the volume charts and specifically for the USD,  in  volume, open interest and net positions for the really bigshots, namely the Commercial Hedgers.

These cats ARE the bigwigs and I never go against them in my plays.

<{POST_SNAPBACK}>

The trend is your friend.

Forex is all about fundamentals.

There will always be short term ups and downs and profit-taking.

Euro at $1.35 today.

Long term the dollar as an IOU is dead as is the dotcom US service economy.

And if the world's richest investors and central banks are all wrong,who will buy those dollars?

[Harmonica]

LivinLOS,

First things first; I just returned to the "Currency" thread started by Flummoxed and was pleasantly surprised to see your chart. I didn't even know we could do something like that on this board.

Anyway, I have responded to your question. I have not yet put in any charts of my own. Please read. I'm a bit tired now, so I hope my typing and thoughts were coordinated.

We can continue the USD discussion here and/or there tomorrow. Here seems better.

Goodnight

Harmonica

[Harmonica]

Ravisher,

Your understanding of the subject is very good; don't sell yourself short. What I'm into is just the technical aspect of the market. By the way, this is my hobby and although I make a prettty good living at it, it is not my profession.

The Commercial Hedgers are very powerful people indeed. I will not say that anybody can control the markets, as such an action would strain the resources of even the US Govt. What I can say, based on what I know and understand is that these Hedgers are ALWAYS oposite to the general public at major market turns. They FORCE an issue over time with tremendous reserves. Understand that a TURN can occupy several months and is not necessarily, in fact rarely, V-shaped.

I am saying that we are at such a turn now and even though the Dollar is still sinking, I feel the support between 84-80 for the Dollar Index will hold.

To the best of my knowledge, be it Gold, the UD$ or any other commodity, the Hedgers have NEVER been wrong against the Public.!! Fellows like me need alot of patience because sometimes one has to wait several months for the move to materialize. I'm now in the early stages of accumulating Dollars and awaiting further signals (technically, of course) before doubling up.

Goodnight

Harmonica

[LivinLOS]

Thats what happens when people buy shares without looking at fundamentals.. Dot com bubble etc.. PE of more than 15 maes me reluctant unless I hear a very good reason..

Not into playng day trades any more.. Only interested in trends..

[~G~]

...Because fellows like me played that up/down move twice, went LONG on the up and then SHORT on the downleg.  The profits were gorgeous. 

...

<{POST_SNAPBACK}>

Exactly! this is all a question of playing the market versus making an investment:

If you are into the exciting game of trading Forex on a daily/weekly basis then, Harmonica, I totally agree with go. Full credit goes to technical analysis, and to computerized automatic stop-loss and take-profit orders (plus optional hours of staring at the realtime graphs). Then you can profit from both ups and downs as you described. Indeed many Forex traders don't hold currencies for a long time, they are happy to take 0.5% profit today, maybe 0.7% next week, etc.

But if, on the other hand, you are more interested in longer term investments and don't want to spend much of your time looking at Forex graphs, then you better check the Macro Economic data. The short term fluctuations have no importance when you want to find an investment that you can stick to for the next year or two.

Then the whole picture changes. As I mentioned in another thread, the trade and investment deficit of the US is predicting only one direction for the next year or two: down. The point is that no one body can stop it! the whole trade/investment balance should change for that to be reversed.

[~G~]

My gut tells me that the US is ‘forcing’ the dollar down for its own ends

Ravisher, it is not the US forcing the dollar down. It is Asian governments stopping it from falling down too quickly. China and Japan are buying tones of US securities/bonds in the last years. That is a known fact. In spite of that the dollar still goes down and down. Meaning, they manage to partly block the fall but for how long?

What do Americans do best, they out-compete, out-invent, out-produce, out-trade, out-consume, out-save, and out-grow every other economy on this planet. I believe they will continue to do so, despite the EU and China.

Maybe so! But not in coming year or two. They are stuck too deep and simply cannot. Reversing the current trend can only happen after a more drastic decline of the dollar. Then they will be able to export more and thereby decrease their trade deficit.

[LaoPo]

My gut tells me that the US is ‘forcing’ the dollar down for its own ends

Ravisher, it is not the US forcing the dollar down. It is Asian governments stopping it from falling down too quickly. China and Japan are buying tones of US securities/bonds in the last years. That is a known fact. In spite of that the dollar still goes down and down. Meaning, they manage to partly block the fall but for how long?

What do Americans do best, they out-compete, out-invent, out-produce, out-trade, out-consume, out-save, and out-grow every other economy on this planet. I believe they will continue to do so, despite the EU and China.

Maybe so! But not in coming year or two. They are stuck too deep and simply cannot. Reversing the current trend can only happen after a more drastic decline of the dollar. Then they will be able to export more and thereby decrease their trade deficit.

<{POST_SNAPBACK}>

Indonesia is already selling US$'s on a smaller scale. The real fear comes from Japan and China; if they start selling the USS's they have (and they have a few dollars...) it would be dramatic for the whole world-economy, including the Far East currencies, since the US$ is still the world-standard economic currency; but for how long...?

A low dollar would indeed be of great benefit for the US trade deficit...but there is more in the world economy than this deficit alone.

Tough years are lying ahead for all of us and it will be interesting to know WHERE to find the Golden opportinities since there will be some.

HAVE A WONDERFUL CHRISTMAS, ALL OF YOU AND YOUR FAMILIES

LaoPo

[Harmonica]

Ravisher,

>>>>" how much can be made by those in 'real' POWER?"

Amen!

Good story. Thanks.

Remember Enron? I didn't own any shares; actually turned down several suggestions by friends to go in and buy a truckload. Why?

I think LivinLOS and G will probably relate to the astoundingly rotten balance sheets about a year or so before the story became public. Forget about Operating Cash Flow--Free Cash flow had already started to turn negative and got even more so with each successive quarter. That's the fundamental side.

Technically, the stock was rising on drooping momentum and the supports looked shaky. When a major trendline was broken, I told these buddies, "you're going to get burned; I wouldn't touch this stock!"

The rest is history. It took a while for the disaster to strike, but Tech. kept me out and warned me not to enter.

The same applies to any Company in present time. I don't care how good the fundamentals look. If the Technicals (the actual footprint of the buyers and sellers = the only thing that counts) are shaky I get out, or don't get in at all! Period!

Hey, it's Christmas Eve. Have a happy one and may the US$, which you've discussed so much lately (good for you!) reveal its secrets to you (and to us all).

My ex loves Greece, maybe as much as you do. Outstanding food! You're a lucky fellow, Ravisher.

[Harmonica]

LivinLOS,

Trends!! I'm a medium-term Trend player; I do NOT daytrade, never have, never will!

This is our common ground. You're a fundamental and I'm a technical player. Professionals in these two camps rarely get along and usually bitch at each other. I've never understood why. We don't need to follow their lead. We can disagree. Its healthy and brings out the "thinkingcaps"

Merry C and Happy NY.

[Harmonica]

G,

Yes, I do use STOPLOSS strategy. Infact I never open a position without one, whether Long or Short.

I learned this the hard way when EPIQ (Nasdaq) dropped like a stone back in 2001, losing 14% in 45 minutes; I had just bought and was going to turn off the computer.

I was transfixed.

I couldn't move.

I just stared in disbelief and then the stock, without any reason, started climbing like a rocket.

When it got to just a minus 2% (loss) I got out, had a stiff drink and realized my analysis was totally flawed. Since then I've never wavered from using the STOP!

Whew!

[~G~]

G, 

Yes, I do use STOPLOSS strategy.  Infact I never open a position without one, whether Long or Short.

<{POST_SNAPBACK}>

And I won't argue for a second that one shouldn't! For short/medium term trading it is definitely neccessary. Trading without stoploss is only for those of us with psychic powers.

My point is that for long term investments - say 10 years or more - the strategies have to be different. If I decide to keep 5% of my savings in dollars - today's or next week's drops won't really matter. What matters in this case is what happened to American economy throughout this decade. Of course, if you closely follow the market, and using technical analysis you buy and sell, you'd probably make much more money. But not many people will keep on doing it, week after week, for years and years until they retire.

Merry Xmas and a happy, successful new year!

[LaoPo]

As for the secrets of the US Dollar...  The casino that I now work in is a great example. The rules are so simple... Happy customers, happy staff and the money takes care of itself.

<{POST_SNAPBACK}>

Ravisher...............WOW, you just made My Xmas

Can you teach me how to take care of the money maybe we could go to TH and have some fun, right?

...... just joking....of course

HAPPY CHRISTMAS

LaoPo

[ray23]

Ravisher,

>>>>" how much can be made by those in 'real' POWER?"

Amen! 

Good story.  Thanks.

Remember Enron?  I didn't own any shares; actually turned down several suggestions by friends to go in and buy a truckload.  Why?

I think LivinLOS and G will probably relate to the astoundingly rotten balance sheets about a year or so before the story became public.  Forget about Operating Cash Flow--Free Cash flow had already started to turn negative and got even more so with each successive quarter.  That's the fundamental side.

Technically, the stock was rising on drooping momentum and the supports looked shaky.  When a major trendline was broken, I told these buddies, "you're going to get burned; I wouldn't touch this stock!" 

The rest is history.  It took a while for the disaster to strike, but Tech. kept me out and warned me not to enter.

The same applies to any Company in present time. I don't care how good the fundamentals look.  If the Technicals (the actual footprint of the buyers and sellers = the only thing that counts) are shaky I get out, or don't get in at all! Period!

Hey, it's Christmas Eve.  Have a happy one and may the US$, which you've discussed so much lately (good for you!) reveal its secrets to you (and to us all).

My ex loves Greece, maybe as much as you do.  Outstanding food!  You're a lucky fellow, Ravisher.

<{POST_SNAPBACK}>

Not knowing much about markets, I did a bit of number crunching and finally came to the conclusion that it would have to drop at least 70% and stay there forever to really effect the qaulity of my life.

I once asked a stock broker how to invest. Knowing he was dealing with a novice, his answer simple buy low sell high. Seems to be what you are saying.

I have 1,600,000 in Iraqi dinar, I don't expect anthing much from it for ten years. But it could be significant depending how the conflict is finally resolved. Have had it for about six months so far I lost $25.00. The only reason I mentioned it was I made an investment knowing the risks. I bought while working in Kuwait and you shoud have heard the rumours floating around, people were actually expecting a exchange rate of $1.00 to a dinar within weeks. I that had happened it would have ruined the worlds economy. So when I bought mine I knew I woudl be holding for a long time. At least until the conflict setttles down and Iraq is pumping oil on a serious level.

Point is if the dollar drops on the basis that the Agertina currencies did, that would ruin the worlds economy. The world will not let that happen.

Merry Christmas to all

[pantarei]

LivinLOS,

You've put forth some very interesting analysis. I applaud your effort at figuring out the markets.

You asked me for "one single fundamental reason why the Dollar could go up" -- well, there is none, not a single fundamental reason.

However, therein lies the trap, for I believe you're using the wrong tool.

And for others here who have been quoting CNBC, WSJ, Nation, Bangkok Post and a host of other mainstream Media financial experts, all I can say is, you will never win following their advice because their job is simply to keep the game going forever and,  if you get smart,  it kind of defeats their modus operandi.  They are not your friends. They should be avoided at all costs.  Their only valuable service is raw DATA.  This is what you use and then, go do your own analysis.

Here's a nugget for starters:

"At major turning points the Media and therefore the general public, aka the HERD, is ALWAYS on the wrong side of the market and leads the public enthusiastically over the cliff! It rarely acknowledges the error until the reverse move is well underway and a new uptrend has been establlished; then it latches onto this and the cycle repeats"

###### em, I say.  Start then and you have a shot.

<{POST_SNAPBACK}>

Your ideas are supported by the “Purchasing Power Parity” theory. I am not an economist and became aware of the PPP fairly recently (late 2000). At the time, according to the PPP, the Euro was undervalued about 30% relative to the US $. Since then the Euro has appreciated over 50% and is now overvalued roughly 20% relative to the US $.

It is just a matter of time until the US $ will steadily advance against the Euro.

Fundamental reason - it is undervalued relative to the Euro. A classical case of an overcorrection based on emotion.

“Purchasing power parity (PPP) is a theory which states that exchange rates between currencies are in equilibrium when their purchasing power is the same in each of the two countries. This means that the exchange rate between two countries should equal the ratio of the two countries' price level of a fixed basket of goods and services.”

Merry Christmas and Happy (contrarian) Investing.

[ray23]

LivinLOS,

You've put forth some very interesting analysis. I applaud your effort at figuring out the markets.

You asked me for "one single fundamental reason why the Dollar could go up" -- well, there is none, not a single fundamental reason.

However, therein lies the trap, for I believe you're using the wrong tool.

And for others here who have been quoting CNBC, WSJ, Nation, Bangkok Post and a host of other mainstream Media financial experts, all I can say is, you will never win following their advice because their job is simply to keep the game going forever and,  if you get smart,  it kind of defeats their modus operandi.  They are not your friends. They should be avoided at all costs.  Their only valuable service is raw DATA.  This is what you use and then, go do your own analysis.

Here's a nugget for starters:

"At major turning points the Media and therefore the general public, aka the HERD, is ALWAYS on the wrong side of the market and leads the public enthusiastically over the cliff! It rarely acknowledges the error until the reverse move is well underway and a new uptrend has been establlished; then it latches onto this and the cycle repeats"

###### em, I say.  Start then and you have a shot.

<{POST_SNAPBACK}>

Your ideas are supported by the “Purchasing Power Parity” theory. I am not an economist and became aware of the PPP fairly recently (late 2000). At the time, according to the PPP, the Euro was undervalued about 30% relative to the US $. Since then the Euro has appreciated over 50% and is now overvalued roughly 20% relative to the US $.

It is just a matter of time until the US $ will steadily advance against the Euro.

Fundamental reason - it is undervalued relative to the Euro. A classical case of an overcorrection based on emotion.

“Purchasing power parity (PPP) is a theory which states that exchange rates between currencies are in equilibrium when their purchasing power is the same in each of the two countries. This means that the exchange rate between two countries should equal the ratio of the two countries' price level of a fixed basket of goods and services.”

Merry Christmas and Happy (contrarian) Investing.

<{POST_SNAPBACK}>

I wanted to take a moment to thank you guys I have found this to be a really interesting subject, I don't know who is right or wrong but it certainly interesting to see the different views.

Merry Christmas

[pistonpilot]

http://www.everbank.com

[~G~]

It is just a matter of time until the US $ will steadily advance against the Euro.

Fundamental reason - it is undervalued relative to the Euro.  A classical case of an overcorrection based on emotion.

“Purchasing power parity (PPP) is a theory which states that exchange rates between currencies are in equilibrium when their purchasing power is the same in each of the two countries. This means that the exchange rate between two countries should equal the ratio of the two countries' price level of a fixed basket of goods and services.”

Merry Christmas and Happy (contrarian) Investing.

Who cares about purchasing power? Thats purely theoretical. The average American consumes and spends much more than the average European!

Lets note -

P(us) = "price level of an average consumption basket in US"

P(eur) = "price level of an average consumption basket in Europe"

I think it will be closer to the truth to say that the exchange rate will be P(us)/P(eur).

Still it's far from being accurate. May be it'll better to take "price of imported items in an average consuming basket". Anyway it seems like PPP assumes that consumer patterns in the countries compared are identical which is FAR from the truth!

[LaoPo]

As for the secrets of the US Dollar...  The casino that I now work in is a great example. The rules are so simple... Happy customers, happy staff and the money takes care of itself.

<{POST_SNAPBACK}>

Ravisher...............WOW, you just made My Xmas

Can you teach me how to take care of the money maybe we could go to TH and have some fun, right?

...... just joking....of course

HAPPY CHRISTMAS

LaoPo

<{POST_SNAPBACK}>

You may think it amusing and over simplified... but I assure you it is not. When Thailand gives the ok for casinos... just find a licence anywhere... How much 'advertising' do you think the casino would need? None! Would you need a Public Relations dept? No. The public relations are taken care of by the 'well trained' staff at each point, reception, security, cleaners, dealers and up... Would you need a Marketing Department. No. Everybody will know where you are inside 3 months. Would you need Financial Controllers. No. They will OVER cut costs and in doing so, p*ss off the staff (bang goes your customer relations etc) They will also cut the customers comps etc. etc. (there goes your marketing) and &lt;deleted&gt; up your business in general.

Just get a 'licence' and I'll show you how the money takes care of itself

<{POST_SNAPBACK}>

I wish it were that simple to get a license in TH... but I remember that there were talks about setting up one on an island opposite Pattaya,,,,,,,,,,,????

Any news about that?

Apart from that, I think the top guys in TH would know how to finance and get control over that very soon.....or would ask the help of the Chinese/HK-Macau tycoons... right?

[~G~]

As for the secrets of the US Dollar...  The casino that I now work in is a great example. The rules are so simple... Happy customers, happy staff and the money takes care of itself.

<{POST_SNAPBACK}>

Ravisher...............WOW, you just made My Xmas

Can you teach me how to take care of the money maybe we could go to TH and have some fun, right?

...... just joking....of course

HAPPY CHRISTMAS

LaoPo

<{POST_SNAPBACK}>

You may think it amusing and over simplified... but I assure you it is not. When Thailand gives the ok for casinos... just find a licence anywhere... How much 'advertising' do you think the casino would need? None! Would you need a Public Relations dept? No. The public relations are taken care of by the 'well trained' staff at each point, reception, security, cleaners, dealers and up... Would you need a Marketing Department. No. Everybody will know where you are inside 3 months. Would you need Financial Controllers. No. They will OVER cut costs and in doing so, p*ss off the staff (bang goes your customer relations etc) They will also cut the customers comps etc. etc. (there goes your marketing) and &lt;deleted&gt; up your business in general.

Just get a 'licence' and I'll show you how the money takes care of itself

<{POST_SNAPBACK}>

"The house always wins"

[Yangpuss]

Everbank says on their website that the Chinese Renmimbi account is a high risk, emerging market investment. Can anyone explain to me what the risk is? Aside from the fact that they pay 0% interest on that account, I mean...isn't the Renmimbi's eventual rise considered pretty certain? How could I lose money on that investment?

Thanks.

[usatrader]

As I am unsure I read anyone’s response to this part of your inquiry beyond the point and counter discussions of political combat about the nation the dollar represents.

Here is two more cents!

My money in the US is guaranteed by the government. If I invested in a foreign bank, can I still have a guarantee on my savings

Absolutely not. Except, if you want to take the considerable risk to currency speculate without any insured guarantee. Even so it should be “I don’t need it” small amounts.

For example, I have Bhat in Thailand with a weighted Average of 46.2 Bhat to the $. If I convert it back at 39 bhat to the dollar I get about 18.46% return less transaction costs. I have sit tight on that money for a few years now. Maybe I will wait a while longer if at all. Wired moneys and bank used debit cards have proven reliable so far when I need money.

Risks: Thai bank could fold, Government could change rules for Farang, Bank could ripe me off. Currency could have gone even higher causing me to keep money there maybe forever.

If your $ are in a national or state bank in the US its insured by the FDIC up to 100,000 per person not account. If in a brokerage SIPC insures up 500,000 but only 100,000 in cash. Some brokers have additional insures fro stocks up to 3 million. Take it out of the US and face currency appreciation/ depreciation risk with no guarantee. Dribble it in as you need may be cost effective if all the circumstances come together.

As to another question someone posted about the Pyramid and eye on the dollar. It is believed derived from the Free Masons which some of the founding father may have been. Likewise, , Annuit Coeptis, loosely translated, means "He has given approval to our undertakings" and Novus Ordo Seclorum or New Order of the Ages was the beginning of this new spirit.

That is all!

[LaoPo]

Everbank says on their website that the Chinese Renmimbi account is a high risk, emerging market investment. Can anyone explain to me what the risk is? Aside from the fact that they pay 0% interest on that account, I mean...isn't the Renmimbi's eventual rise considered pretty certain? How could I lose money on that investment?

Thanks.

<{POST_SNAPBACK}>

The pressure on China to do something about the RMB/Yuan is immense, especially by the US but also Japan and Europe.

It's difficult to judge what 'Beijing' will do about this. The enormous financial 'powers' worldwide would like to see the RMB rise against the other currencies.

Buying RMB is still a risk I would say, since nobody knows what will happen in the foreseeable future. China is heavily trying to cool down the economy. Amongst others it is now very difficult for private people AND companies to get extra loans and thus the sales of homes and cars for instance is rapidly going down.

If 'Beijing' succeeds in the cool-down remains to be seen, since Jan 1 all the protection measurements for textiles (for instance) has been cut to zero. Beijing said to the US and Europe that they would tax extra on textile-exports but they didn't say when and how much...

If they export too much (and that will happen!) Europe/US could take protection against the massive imports from China, resulting in an economic 'war' since China will come with their counter-attacks.

If the RMB rises, it still will be difficult to judge if one should buy the RMB since there is a big difference in buying/selling-price in RMB so you will loose when you will try to sell the RMB on the market again.

All-in-all...difficult to judge

LaoPo