Currency Devaluation In Colombia, Brazil, Euro . . .

[rickulivi]

Currencies are devaluing in lots of places vis a vis the dollar. I understand that the peso in Colombia is down over 40% in the last few months, you should know the Brazilian real is down about as much, and the Euro too. When will the Argentine peso drop and how much? What is your prediction?

 

[Girino]

Until Cristina's damp holds. Maybe even until November!

 

[Ceviche]

its amazing.

Real has plummeted . First time gone to 3.1 since the late 90s.

Colombian Peso and Guarani have plummeted as well.

Wondering how the 'red buck' is holding when it was one currency falling down in every season, every year.

==

Some of my friends who pay rent in peso are struggling as every 6 month their rent is going up by 15% or so, but the dollar versus the red buck is steady!

 

[garryl]

Last few days, Chinese government smelled the danger after FED's talk, the Chinese RMB has been declining in past 12 months , looking weak, Goldman Sachs has been trying to short the controlled RMB in different ways, hoping to see a big collapse in RMB, a few days ago, Chinese government suddenly pumped up the RMB, removed all the loss of this year.
This happened after China real estate bubble started to burst, and GDP kept getting lower. China can't accept the vast foreign currency to leave the country, it artificially pumped up the stock market to retain rich people's dinero inside the country. Usually when US economy returns, it attracts/sucks the dollars (which had been lost during the recent recession) back to US, causing other countries to collapse, like 1997 Asian crisis, Mexican peso collapse .. This will be an interesting time. By history experience, the controlled currencies like RMB perform better. But China has been printing too much RMB, pegged it to dollars at 6.2, it's an act to steal other country's wealth. We will see how it can get out of this this time.

Once US starts to raise interest (right now, it's zero, in 2006 4-5% for individual saving account), the process will begin, the $$ starts move globally. It will bring down many small countries easily, like Columbia, Brazil has too much asset bubble, is due for a sharp correct. The BRIC countries are in trouble, the process is just starting,
sit tight, hold your cash and wait.

 

[camberiu]

It will bring down many small countries easily, like Columbia, Brazil has too much asset bubble, is due for a sharp correct. The BRIC countries are in trouble, the process is just starting,
sit tight, hold your cash and wait.

 

[Napoleon]

its amazing.

Real has plummeted . First time gone to 3.1 since the late 90s...

When I was in Brazil for a wedding in 2004 (Feb 10th-26th), the exchange was - Real 2.91 : US$1

 

[Ceviche]

When I was in Brazil for a wedding in 2004 (Feb 10th-26th), the exchange was - Real 2.91 : US$1

When I was in Brazil in 1998, the exchange was Real 3.1 : USD 1

 

[garryl]

Time to visit Brazil, again

 

[sesamosinsal]

Usually when US economy returns, it attracts/sucks the dollars (which had been lost during the recent recession) back to US, causing other countries to collapse, like 1997 Asian crisis, Mexican peso collapse ..

This is not accurate. When the US economy is thriving, dollars flow out of the U.S. There's a reason why consumer demand and consumer debt are so important for the global economy as a whole.

When the Fed increases the interest rate (to lower inflation), dollars abroad tend to flow toward U.S. Treasuries and U.S. economic activity (e.g. debt fueled consumer demand) decreases (the debt is more expensive). All of this has profound effects on foreign countries as U.S. dollars flow outward and they have to raise their own interest rates to defend their currencies, which stifles national economic activity... It's messy.

The Fed raising interest rates is absolutely hilarious. First, we don't have inflation in the U.S. The economy is deflationary. What central bank is going to raise interest rates in a deflationary economy? However, the debt bubble only gets bigger and bigger if we don't raise rates.

The only way out is devaluing the dollar (inflation)... and having the U.S. actually balance its trade deficit. Our national industry is currency printing, and has been since the 70s. The Fed is desperate to make things seem normal again, but as soon as they start raising rates -- if they actually do -- the "fun" will really begin.

 

[garryl]

This is not accurate. When the US economy is thriving, dollars flow out of the U.S. There's a reason why consumer demand and consumer debt are so important for the global economy as a whole.

When the Fed increases the interest rate (to lower inflation), dollars abroad tend to flow toward U.S. Treasuries and U.S. economic activity (e.g. debt fueled consumer demand) decreases (the debt is more expensive). All of this has profound effects on foreign countries as U.S. dollars flow outward and they have to raise their own interest rates to defend their currencies, which stifles national economic activity... It's messy.

The Fed raising interest rates is absolutely hilarious. First, we don't have inflation in the U.S. The economy is deflationary. What central bank is going to raise interest rates in a deflationary economy? However, the debt bubble only gets bigger and bigger if we don't raise rates.

The only way out is devaluing the dollar (inflation)... and having the U.S. actually balance its trade deficit. Our national industry is currency printing, and has been since the 70s. The Fed is desperate to make things seem normal again, but as soon as they start raising rates -- if they actually do -- the "fun" will really begin.

It depends where you live in US, all that QEs Fed did started to cause inflation. In SF Bay Area, the rent increased by 50% in last 2-3 years, in SF rent doubled, food, transportation, all become more expensive, the business is booming, stock market kept hitting all time high, housing passed the all time high too, higher than crazy bubble time, so Fed has to do something.