Heaven Forbid: Are we inching toward fixed G-10 currency rates?
I just uploaded a provoking article to the Aite Group Blog. It touches on a fear that I trust will never be realized, seeing G-10 fixed currency rates. But events on the ground appear to be leading us closer unless we correct critical shortcomings in the current free floating regime.
With palpable fears of a eurozone breakup and sagging confidence on the U.S. dollar, the world may be bracing for a repeat of 2008 and 2009. While I hope this is just a new episode of high volatility in currency markets, we may…
Interesting scenario, albeit one that renders this group obsolete, and puts most of us on the wrong side of the unemployment statistics. Hopefully the notion of a global accord to peg rates is seen as simply requiring too much bureaucratic and regulatory heavy lifting. Imagine also what kind of price swings we’d see in the equity, bond and commodity markets if there were no exchange rates to absorb temporal pressures.
Indeed. The only mention of this ghastly scenario is to highlight the urgency that those of us who love and bread FX need to have to push for a resolution of systemic imbalances like that brought on by China’s dollar peg and the globe needing a new global reserve currency.
There seems to be some signs of this already. Swiss, Yen authorities have intervened to depress their currencies, what will stop the Loonie & Aussie not to do so? Everyone is pointing to the China model as the one to adopt?
Behind me Satan!!! I make money everyday and I’ve spend a year to learn how to do this and I see a nice Porche on the horizone!!!
Look what is happening when you trade based on an intervention and not based on FREE Market:
And this are his open positions:
minus 6376 pips. This is something!
the only central bank under pressure with capital to move markets is the BOJ. The loonie, kiwi, and swissie central banks have only limited firepower.
Grigore, I share your view. Porsche = good, interventions = bad 🙂
Although I usually sell USDJPY and EURCHF after interventions :- P
however, with frequent gov’t interventions who is not to say they may just go for a fixed or pegged exchange rate? That mantra seems to have worked well for Asian & Middle Eastern countries. True, they are still emerging countries, but aren’t the developed countries going back to basics?
I now post my TRADING ALERTS
into my personal FACEBOOK ACCOUNT
. Don't worry as I don't post stupid cat videos or what I eat!