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Finance & Stock Groups Forum Index » Financial Planning » If the Euro continues to gain
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| Jim |
 Posted: Tue Jun 26, 2007 1:00 am |
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..against the US Dollar, why is this not a good thing? I understand that
from a small individual financial planning point-of-view, foreign treasury
holding may continue to decline and that would mean US interest rates would
climb.
why would high interest rates be such a bad thing? It would mean higher
payments on money market funds, better rates for Certificates of Deposit and
Bonds would produce better rates - no ?
see this article..
http://www.forbes.com/home/opinions/2007/06/19/croesus-chronicles-china-oped-cz_rl_0620croesus.html
"..Of course there are heavyweight worriers like Lawrence Fink, chairman of
BlackRock (nyse: BLK - news - people ), a major investment management
concern. He predicted in a presentation that "dollarization will end
eventually. The effect on the reversal of U.S. interest rates and credit
spreads could be devastating.".." |
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| PeterL |
| Posted: Tue Jun 26, 2007 1:24 am |
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On Jun 25, 2:00 pm, "Jim" <j...@zonk.jp> wrote:
Quote: ..against the US Dollar, why is this not a good thing? I understand that
from a small individual financial planning point-of-view, foreign treasury
holding may continue to decline and that would mean US interest rates would
climb.
why would high interest rates be such a bad thing? It would mean higher
payments on money market funds, better rates for Certificates of Deposit and
Bonds would produce better rates - no ?
see this article..http://www.forbes.com/home/opinions/2007/06/19/croesus-chronicles-chi...
"..Of course there are heavyweight worriers like Lawrence Fink, chairman of
BlackRock (nyse: BLK - news - people ), a major investment management
concern. He predicted in a presentation that "dollarization will end
eventually. The effect on the reversal of U.S. interest rates and credit
spreads could be devastating.".."
Good or bad for who? For some it's good, for others it's bad. |
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| Guest |
| Posted: Wed Jun 27, 2007 12:09 am |
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On Jun 25, 5:24 pm, PeterL <po.n...@gmail.com> wrote:
Quote: On Jun 25, 2:00 pm, "Jim" <j...@zonk.jp> wrote:
..against the US Dollar, why is this not a good thing? I understand that
from a small individual financial planning point-of-view, foreign treasury
holding may continue to decline and that would mean US interest rates would
climb.
why would high interest rates be such a bad thing? It would mean higher
payments on money market funds, better rates for Certificates of Deposit and
Bonds would produce better rates - no ?
see this article..http://www.forbes.com/home/opinions/2007/06/19/croesus-chronicles-chi...
"..Of course there are heavyweight worriers like Lawrence Fink, chairman of
BlackRock (nyse: BLK - news - people ), a major investment management
concern. He predicted in a presentation that "dollarization will end
eventually. The effect on the reversal of U.S. interest rates and credit
spreads could be devastating.".."
Good or bad for who? For some it's good, for others it's bad.
Many currency traders out there look for any type of movement vs. the
dollar whether it be strength or weakness. Higher interest rates would
lead to a higher valued dollar therefore negating some of the effect
on the strengthened Euro. This all depends on what market you are
exposed to if you will be effected or not in a negative aspect.
Currency day traders and swing traders look for any movement. It is
the times when there is no defined strength where people lose money.
I hope this helped a bit.
www.celerityfx.com |
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| Usenet2007@THE-DOMAIN-IN. |
| Posted: Thu Jun 28, 2007 1:01 pm |
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Guest
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In article <5ealm0F381ujlU1@mid.individual.net>, jim@zonk.jp
says...
Quote: ..against the US Dollar, why is this not a good thing?
It depends on factors like, where you live, and in which currency
your income is denominated, and if you are an importer/exporter,
or in a similar position to them.
For example, if you were in the EU, and earned your income by
exporting stuff to the US, then a weak greenback (plus strong
Euro) could reduce your effective income (in Euros.)
Quote: I understand that
from a small individual financial planning point-of-view, foreign treasury
holding may continue to decline and that would mean US interest rates would
climb.
why would high interest rates be such a bad thing? It would mean higher
payments on money market funds, better rates for Certificates of Deposit and
Bonds would produce better rates - no ?
It depends on things like your own debt. Higher local interest
rates would hurt you, if you had an adjustable rate mortgage, or
other floating debt.
Also, it depends on your international exposure or involvement.
For example, higher local interest, might just mean receiving
more units of a lower-valued currency. Like getting more
greenbacks from your investments, but each greenback is smaller
than before.
If you are buying and/or selling in/from/to two different
countries, then things get rather complicated, as far as what is
good or bad with currency strengths.
--
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