I am interested in reader's thoughts as to whether the Australian dollar will fall to 90cents USD and beyond. If this is the general consensus, how are we going to profit from this? Contracts for difference, buying usd now over the counter, buying more overseas products now, selling overseas assets?
Australian dollar, currency movements
- Thread starter china
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Am guessing and hoping it will hit close to 92/3c soon. Might buy back some A$ if that happens and swing back up to around 94/5c
How are you buying AUD? Do you do direct over the counter purchase or via a forex account? Or international money transfers? Why do you think it will turn around at 92 cents?
and only 10 short years ago when is was USD$0.48 to the AUD$1.00.
You can't buy A$s with A$s. If you wish to go long you must leverage via forex transactions. Theoretically I'm heavily hedged via stock denominated in the loony. Trouble is, they are falling along with us.
If you think our $ has further to fall and don't want to play the forex market you could transfer money into an asset denominated in USD and repatriate it later. This could be done by buying GOLD on the ASX [POG is quoted in USD] and this could be leveraged via a margin a/c. If you think the pickings a bit thin for the risk involved, watch and enjoy from the sidelines.
For those of us without the necessary skills for forex trading, it's easier to have a night at the casino.
Disclaimer: This post is for entertainment only. I am not advising doing such trades, just discussing the possibilities.
If you think our $ has further to fall and don't want to play the forex market you could transfer money into an asset denominated in USD and repatriate it later. This could be done by buying GOLD on the ASX [POG is quoted in USD] and this could be leveraged via a margin a/c. If you think the pickings a bit thin for the risk involved, watch and enjoy from the sidelines.
For those of us without the necessary skills for forex trading, it's easier to have a night at the casino.
Disclaimer: This post is for entertainment only. I am not advising doing such trades, just discussing the possibilities.
Are we likely to have a GFC 2? where we can expect 1 aud to equal 67 US cents?
If this is the case, should we not be buying us dollars as much as we can right now?
China, we are having GFC II and the world is already buying USD and Swiss Francs at a frantic rate. So much so the franc has a -ve interest rate and the USD virtually zero.
Here the US rates on treasuries:
Date 1 Mo 3 Mo 6 Mo 1 Yr 2 Yr 3 Yr 5 Yr 7 Yr 10 Yr 20 Yr 30 Yr
06/01/12 0.03 0.07 0.12 0.17 0.25 0.34 0.62 0.93 1.47 2.13 2.53
The past is no guide to the future!
The Swiss Franc can only decline against the Euro due to SNB floor. I get paid in Francs & regularly convert them to Euros.
I don't know what this floor is. Is that the peg they imposed to stop the currency rising too far?
Can buy USD/any currency via normal savings accounts from international banks (eg BofA, Citi, HSBC, Barclays) at very good rates too (on par with whatever you'll get at specialised Australian brokerage firms).
Big issues as I see it now are:
- Potential Greek collapse and bank run (driven by potential exit from Euro and depreciation of a new Dracmah which will make Greek and Greek people as poor as any African country you could imagine)
- Contagion and bank runs in Spain and Portugal and, in the worst case, Italy and their potential exit from Euro due to failure to provide a sufficient deposit guarantee scheme
- Overall European financial meltdown as a result
- Impact on China, which is an export-driven country whose primary customers are Europe and USA, of a European financial meltdown
- Accelerated slowdown in construction and development in China and collapse of its underground US$2.6 trillion lending market (compared with its official banking lending market of US$1.1 trillion)... check out the execution of the 22-year old (I think) Rich Sister for media sensationlised glimpses in to the underground market
Not too concerned about the US to be honest. Market overreacting today to US job data.
Big issues as I see it now are:
- Potential Greek collapse and bank run (driven by potential exit from Euro and depreciation of a new Dracmah which will make Greek and Greek people as poor as any African country you could imagine)
- Contagion and bank runs in Spain and Portugal and, in the worst case, Italy and their potential exit from Euro due to failure to provide a sufficient deposit guarantee scheme
- Overall European financial meltdown as a result
- Impact on China, which is an export-driven country whose primary customers are Europe and USA, of a European financial meltdown
- Accelerated slowdown in construction and development in China and collapse of its underground US$2.6 trillion lending market (compared with its official banking lending market of US$1.1 trillion)... check out the execution of the 22-year old (I think) Rich Sister for media sensationlised glimpses in to the underground market
Not too concerned about the US to be honest. Market overreacting today to US job data.
Yes iron ore prices are falling and the currency forecasts etc all already factor that in.
The question is whether it falls by more than what people expect.
The question is whether it falls by more than what people expect.
All speculation but... Easier to do that than to profit from it!
Would be watching out a very strong snapback rally in this market (including all 'risk on' assets such as the Aussie) if (and it's probably a healthy sized if) there can be a solution to the fiscal issues in Europe worked out to satisfy the market, it's not as if we have ridiculous valuations in the equity markets, would suspect the short Europe trade is very crowded at the moment, I read there are -ve yields on Swiss bonds at the moment, that's fear in action for you.
Would be watching out a very strong snapback rally in this market (including all 'risk on' assets such as the Aussie) if (and it's probably a healthy sized if) there can be a solution to the fiscal issues in Europe worked out to satisfy the market, it's not as if we have ridiculous valuations in the equity markets, would suspect the short Europe trade is very crowded at the moment, I read there are -ve yields on Swiss bonds at the moment, that's fear in action for you.
Europe not easy to sort out because the Greek masses have the power now. The pitfalls of the representative democratic system they invented - that is, the people who have no idea are getting the say.
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