Location: Seat 1A, Juice pretty much everywhere, Mucci des Coins Exotiques
Posts: 14,868
Yea, I meant free fall against the Euro. Every day it's a few more cents down.
The other very interesting thing is that the Euro has almost reached parity with the pound. This is now putting political pressure on the UK government to join the Euro.
Analysts are now saying that the pound will inevitably dip below the Euro in 2009. That will wake up the British traveling public. And the British Champagne drinking public too!
The pound and the euro inch ever closer to parity.
Quote:
Originally Posted by stimpy
Yea, I meant free fall against the Euro. Every day it's a few more cents down.
The other very interesting thing is that the Euro has almost reached parity with the pound. This is now putting political pressure on the UK government to join the Euro.
Analysts are now saying that the pound will inevitably dip below the Euro in 2009. That will wake up the British traveling public. And the British Champagne drinking public too!
Sadly I think you're both right.
Barely one year ago, one euro only bought you 67p. Now it's 90p.
And the most vexing thing about this is that national media outlets can barely contain their glee! They are bringing it about! Front page of the Observer (Guardian) this weekend said "Pound slips below Euro for the first time" - and hidden in the small print was a disclosure that it was £20 which bought €18 at a cheesy tourist-trap bureau de change, and including the fixed commission and the exorbitant rate.
You would have got a much better deal from your bank changing £100.
It's as if they want us to be bankrupt! In fact, I think part of them do.
And the most vexing thing about this is that national media outlets can barely contain their glee! They are bringing it about! Front page of the Observer (Guardian) this weekend said "Pound slips below Euro for the first time" - and hidden in the small print was a disclosure that it was £20 which bought €18 at a cheesy tourist-trap bureau de change, and including the fixed commission and the exorbitant rate.
You would have got a much better deal from your bank changing £100.
And this surprises you because of the otherwise steadfast journalistic integrity of the British tabloid papers?
It's actually more like a strengthening of the Euro than a fall of the USD...the crossrates with other currencies are much more stable.
It is all about "trust". Until recently, the World trusted the American financial system more than any other financial system. The sub-prime mortgage-led meltdown, followed by the collapse of (what people thought were) reputable banks, and now the US$ 50 billion Madoff fraud have erased all trust that people had in the US financial system, including in its regulators. I agree with IMF chief Dominique Strauss-Khan who said he was shocked US regulators had failed to identify and prevent the fraud. "The surprise is not that there are some thieves in the system, the question is where were the police? It's very surprising to find you're living in a system where a failure of the regulatory system was so big," he told a news conference in Madrid.
I am actually afraid that all current economic and financial medicines won't work - on the contrary, by subsidizing bankrupt companies and keeping interest rates artificially low the required adjustments (basically, for Americans to start living within their means) will be more painful and will take longer.
The euro is by no means perfect, but at this moment is the best available alternative to the USD. And you can still easily get a 5.75% annual risk-free return on an EUR investment.
It is all about "trust". Until recently, the World trusted the American financial system more than any other financial system. The sub-prime mortgage-led meltdown, followed by the collapse of (what people thought were) reputable banks, and now the US$ 50 billion Madoff fraud have erased all trust that people had in the US financial system, including in its regulators.
And slipped nonchalantly into this article in the New York Times yesterday:
Of much greater practical importance, the Fed bluntly announced that it would print as much money as necessary to revive the frozen credit markets and fight what is shaping up as the nation’s worst economic downturn since World War II.
Hello, inflation!
Quote:
Originally Posted by Sjoerd
I agree with IMF chief Dominique Strauss-Khan who said he was shocked US regulators had failed to identify and prevent the fraud. "The surprise is not that there are some thieves in the system, the question is where were the police? It's very surprising to find you're living in a system where a failure of the regulatory system was so big," he told a news conference in Madrid.
Sadly, I'm not shocked at all. Greed is a very powerful motivator.
Quote:
Originally Posted by Sjoerd
I am actually afraid that all current economic and financial medicines won't work - on the contrary, by subsidizing bankrupt companies and keeping interest rates artificially low the required adjustments (basically, for Americans to start living within their means) will be more painful and will take longer.
I agree with you wholeheartedly. But Americans are by no means the only nation living far beyond their means. The problem of uncontrolled personal debt is comparable - if not worse - in the United Kingdom. And let's not even start talking about Iceland (whose finance minister borrowed six times the GDP).
Location: Seat 1A, Juice pretty much everywhere, Mucci des Coins Exotiques
Posts: 14,868
Quote:
Originally Posted by soitgoes
It's actually more like a strengthening of the Euro than a fall of the USD...the crossrates with other currencies are much more stable.
It's because people are moving their money from $'s to €'s. It is absolutely related to a lack of confidence in the US financial system. This isn't a very deep article, but it touches on the problems and their background...http://money.cnn.com/2008/12/16/mark...buzz/index.htm
Here are some useful interest rates
