RBA Hints at FX Intervention

thatguy said:
This is why I think the Euro is such a success, Germany can succeed all it wants and it will not push the up Euro, because they still have the PIIGS weighing it down. Currency devaluation without printing, the holy grail? The USD safe haven status will spike up kill the US economy in the next crash... ironic
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What an awesome idea!!! Do you really think they planned it that way??
 
mmm....shiney! said:
thatguy said:
This is why I think the Euro is such a success, Germany can succeed all it wants and it will not push the up Euro, because they still have the PIIGS weighing it down. Currency devaluation without printing, the holy grail? The USD safe haven status will spike up kill the US economy in the next crash... ironic
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What an awesome idea!!! Do you really think they planned it that way??
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Sure do, but it is one hell of a balancing act... it is best to keep them teetering without going over the edge and at the same time try grab the booty (gold)
 
I suspect the German's have known for a long time how this works, most German's are quite switched on with finance. The problem arises when their debt ridden fellow country's are asking for money and all eyes are on Germany to fork out.

I'm surprised country's like the PIIGS have not simply exited the euro. This is where it's become a political issue where PIIGS country's are 'proud' to be part of the euro and don't want to be seen leaving and going back.

As far as the USD rising that poses challenges as if it does rise the fed can use this as a buffer zone to print more essentially inflating their way out of debt. The question i have is would a high USD really effect America that badly? i see them as simply a service economy and a stronger dollar would at least bring prices of goods down assisting savings rates in a near 0% interest economy.

I may be missing some glaring issue here it's simply because there are just so many factors to comprehend. I'm sure if i did miss something it will be picked up :-)
 
Nukz said:
I'm surprised country's like the PIIGS have not simply exited the euro. This is where it's become a political issue where PIIGS country's are 'proud' to be part of the euro and don't want to be seen leaving and going back.
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It goes far beyond that buddy.

IMF. Do this or else. Nobody likes sanctions. Nobody likes embargoes.
Citizens have become too dependent on consumerism. Iphones are a necessity in life. Didn't you know?
Stop the flow of iphones and people will start dropping dead.

Like any typical junkie, they will be willing to hit rock bottom and maintain that for the rest of their lives. Well, till they 'had enough' and somehow snap the fk outta it.
 
Interesting followup article today...

No need for dollar intervention: Treasury
August 17, 2012 - 2:45PM

Treasury economists have rejected calls for the Reserve Bank to rein in the Australian dollar as ''misplaced'', saying conventional policies are equipped to handle the strong currency.

Government officials have come under growing pressure in recent weeks to follow the Swiss Central Bank and intervene in global markets to restrain the dollar, which is squeezing many exporters.

But in a blunt rebuttal from the nation's top economic department, a new Treasury paper says trying to curb the dollar through market intervention could lead to market instability.

Read more: http://www.theage.com.au/business/t...on-treasury-20120817-24d3u.html#ixzz23mCrFHnI
 
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