Wednesday, October 13, 2010

Forex ALWAYS involves rhyming couplets…

Is this so hard to get our heads around? Here is the lesson:

First read this……

Washington - Fears of a full-blown currency war flared as the US dollar fell to an eight-month low against the euro and the US stepped up pressure on China to let its currency rise. (NZ Herald)

Now read this….

Beijing – Anticipation of a full-blown currency war  grew as the euro rose to an eight-month high against the US dollar and China stepped up pressure on the US to let its currency fall.  (Brent Wheeler Herald)

Currencies are best thought of NOT as investments but as positions – the key being that it is completely and utterly impossible… nor will all the journalists and politicians in the world ever make it any different… for a currency rate to mean anything except relative to another currency.

So various people who ought to know a very great deal better, should stop, cease, and desist permanently from using phrases such as  “saving the export sector”… unless they are happy to declare their desire to destroy the import sector. And if they want stable prices and cheap consumer goods to “stimulate” the economy they should be happy to declare their agreement to destroy a few exports.

And those who use the term “currency wars” should really just read war comics… Whitcouls have them in bound editions for the “big reader”.

I know exciting and important stuff like TV presenters and foreshores and spiritual gynaecology and  really interesting stuff is a distraction but…..  do try to keep up please.

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