Interesting article on free trade, currency controls and conventional wisdom:
http://business.guardian.co.uk/story/0,,1664984,00.html
http://business.guardian.co.uk/story/0,,1664984,00.html
Atilla said:I will follow developements and invest in companies in one form or another and use these as inputs in reaching decisions to make informed investment decisions.
What does this mean? I know gobbldegook when I see it.
China has invested billions and India has doubled it's investment in the last year.
Good for them.
If I was decision maker in US or Europe as I have outlined before I would be warming relations and investing in these countries (er... that's not overthrowing or undermining there governments)
There must be valid reasons as to why this has not happened already then. All I can assume is everyone who has gone before was wrong.
Why is it such a BIG question whether "I" invest in these countries. I don't think I'm that important really.
Well, if you are confident investing in these countries, then just do it, I have no opinion One way or another.
In chasing masquitos you may get sat on by an elephant.
Eric Cantona ?
Think SMALL questions and you may understand it a little more.
Good point, now what is it i'm trying to understand?
I think we should move away from the "YOU's" and discuss non-personnel current events and our views on them how they reflect investment decisions. This is afterall a trading website.
dcraig1 said:Interesting article on free trade, currency controls and conventional wisdom:
http://business.guardian.co.uk/story/0,,1664984,00.html
chump said:CV,
"Maybe there are no Right and Wrong Questions after all,"..that's a bit of a surprise from you.
Look my comment was made because of this stuff and similar.
"So what is your prediction for the $?
Are we likely to see interest or tax rises?
Will there be a soft or hard landing?
Coming back to the thread - what will be the impact on the $ and the Yuan?"
All of these questions share one obvious trait ..they are all asking for the unknowable. That is any answers will only be known at the wrong time , with hindsight. You can't trade ,or invest on this. When you're watching price do you ask yourself this type of question ,or do you ask what is price doing , how does this compare to what I have known in the past where price behaves like this etc etc. In other words you deal with what you know not with what is unknown.
I can't add to this , 'you' either get it ,or 'you' don't but I'm "surprised" because I thought CV that you did.
Chump, don't you worry lol. I'm firmly in the camp that is very selective as to who deserves help and information and who most certainly does not (at the risk of sounding Socratean ) wash my mouth out. .
My question right now , is what am I doing back on this thread LOL fortunately I do know the answer and I can live with it
chump said:CV,
"Maybe there are no Right and Wrong Questions after all,"..that's a bit of a surprise from you.
Look my comment was made because of this stuff and similar.
"So what is your prediction for the $?
Are we likely to see interest or tax rises?
Will there be a soft or hard landing?
Coming back to the thread - what will be the impact on the $ and the Yuan?"
All of these questions share one obvious trait ..they are all asking for the unknowable. That is any answers will only be known at the wrong time , with hindsight. You can't trade ,or invest on this. When you're watching price do you ask yourself this type of question ,or do you ask what is price doing , how does this compare to what I have known in the past where price behaves like this etc etc. In other words you deal with what you know not with what is unknown.
I can't add to this , 'you' either get it ,or 'you' don't but I'm "surprised" because I thought CV that you did.
My question right now , is what am I doing back on this thread LOL fortunately I do know the answer and I can live with it
chump said:So ,let me get this right. You've been "patronised" and "ridiculed" and all by someone who's views are "sadly biased" and thus are at odds with your own.
Your response is to include the obligatory "respect" so all neutral readers can see that you are clearly a reasonable man deserving of their sympathy as you " go away with my tail between my legs ".
It's all about 'you' and yet that will tell 'you' nothing will it.
chump said:So ,let me get this right. You've been "patronised" and "ridiculed" and all by someone who's views are "sadly biased" and thus are at odds with your own.
Your response is to include the obligatory "respect" so all neutral readers can see that you are clearly a reasonable man deserving of their sympathy as you " go away with my tail between my legs ".
It's all about 'you' and yet that will tell 'you' nothing will it.
Dispassionate said:Quote from AFX on 8th Dec 2006 - "A top priority for the Democratic-controlled Congress, which convenes in January, will be raising the federal minimum wage from 5.15 an hour to 7.25 an hour. That wage has not been increased for nearly 10 years."
Will exacerbate problems in the sense that it will make China more competitive imo.
henry766 said:Quote:
Originally Posted by henry766
If Fed have to raise rates , equity markets won't like it , that much is clear ,a falling dollar seems to make raising of rates more likely, ( if nothing else a weakening currency is inflationary)? which seems to make your comments about everyone else expecting a rise very interesting jimmy.
Wrong cause/effect attribution there no?. Rates are expected to fall because the economy is weakening therefore the dollar is falling.
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this is in reply , the reason why rates may rise is because of inflation , which these days with central bank(s) controlling interest rates , is the reason U.S. or any other western economy may raise rates , may have to , even if economy not doing so well.I'm not saying this will happen , and generally slowing economies are deflationary , but most of the influence to central banks is the rate of inflation ( and future inflation) in deciding interest rates (seems to me anyway)
Silvertip said:Yes a double top looks highly probable although 1.98 is a difficult hurdle for GBPUSD due to vibrationary resistance, but it has been hurdled before and economic fundamentals suggest it could be once again.
henry766 said:Good point Atilla , i think your saying that there are opposing influences on u.s. interest rates becuase of a faltering economy that will result in weakening dollar, I quote
"The Fed at the moment is worried about slowing economy (hence considering reducing interest rates to stimulate) and inflationary pressures (requires raising interest rates to dampen demand) - puts us in scenario 1 - worst of the lot. Resulting in $ . " ,
But i said if the dollar weakens , this will be inflationary , which if true , your confirming what i said in that you said " and inflationary pressures (requires raising interest rates to dampen demand) "which seems to be in essence what i said in my earlier post , the only area where i can see a conflict is if you don't think a falling currency is inflationary , though i agree this also means economy is slowing (deflationary), in truth the fed will keep interests rates as low as they can and still keep a hold on inflation , but this is always true at all times in all economies ( why raise rates and slow economy if no inflation).
so if economy stays same but dollar falls this will mean some inflationary pressure ( my earlier point you dissagreed with)
if economy slows and doller falls, inflationary pressures maybe reduced in which case , YES interest rates may come down , but only if , and i did say in my earlier post "if nothing else " meaning in a sense all else being equal , meaning the economy etc , then a falling currency IS inflationary , which i stand by .
As regards your point about "real interest rates" as opposed to plain old interest rates , I understand your point ,but i believe we were all talking about the Fed and their rates , rather than the "real rate of interest ". In general people arn't referring to your "real rates" when talking about interest rates and i wasn't either , i suspect thats because your in a grey area ,after all inflation isn't either a fixed or completely objective figure , people have very different ways of stating inflation , some include price of crude , some don't , some are weighted more on wages , some more on retail prices .Whats more the real rate of interest one would actually receive if invested in another country would also depend on perceived /future currency movement , which is why i simply stated "if the fed raise rates " rather than adding up and reaching subjective conclusions about the "real interest rate ", forgive me but my life is too short