On the topic of China, I seem to recall reading that China is selling US bonds and has sold at least a hundred billion dollars so far in an attempt to prop up the Yuan.
http://www.dailyfx.com/aud Forex Volatility Risk Remains High on Critical Week for US Dollar http://www.dailyfx.com/forex/fundam...y-points-to-major-US-Dollar-market-moves.html
This is piffle. Look at my F##kn currency > 1NZD: 0.633 USD. Makes me happy that i have USD , but sick that i do not have more. I think i literally hit the bottom on my conversion (posted here somewhere at the time) but wish i could have afforded more. ARGHHHHH!
AUD/USD Down Under $0.7000 as HY, EM FX Pressure Remains see link to read further http://www.dailyfx.com/forex/fundam...nder-0.7000-as-HY-EM-FX-Pressure-Remains.html
It's a pay cut if you want to buy anything that is imported or in some way uses imported goods. That makes it a pay cut for pretty much everyone since Australia doesn't actually produce much of value beyond the basics.
Go to Kmart, Woolworths and Bunnings and tell me what percentage of stock is made in Australia from only Australian materials/ingredients.
Very bad for high tech businesses just starting up and having to import increasingly expensive equipment in an environment where banks are adverse to business lending. Very bad also for businesses that have to retool to stay competitive.
Keeping the interest rates low, and making them lower, is only ultimately to protect the property prices (and by proxy the banks). When people can't afford as much because of the lower dollar, that's the reason why. You are helping to pay for the great australian property obsession.