Speculative Attack on a Currency

Discussion in 'Currencies' started by hawkeye, May 10, 2012.

  1. hawkeye

    hawkeye New Member Silver Stacker

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    [youtube]http://www.youtube.com/watch?v=P2IWGlR1SHs[/youtube]
     
  2. Lovey80

    Lovey80 Well-Known Member

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    At the end he fails to mention that although the currency speculator has made a 100% profit in currency B in the trade that 100% in that currency now only buys half of what it use to buy. So it really is a 50% profit because if he exchanged the B currency for A currency he would only get 50 of them.

    He also only mentions the downside of the currency devaluation with higher food and fuel prices as an example. But as soon as the currency devalues, the exports of the nation should rise significantly and the imports will diminish very fast. It should be self levelling and the central bank should again be able to begin accumulating stores of currency A.

    This right here highlights the importance of a country being as self reliant as physically possible and always have an eye to exporting goods. This service/consumer economy notion is a load of rubbish. No one ever consumed their way to prosperity.

    Wayne Swan should have a sign on his dunny door that says: Produce more than you consume and you win.
     
  3. Lovey80

    Lovey80 Well-Known Member

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    I thought I would get a few comments. Anyone else got a comment on the Vid?
     

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