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Trump Has Become The Single Biggest Global Market Influence

Posted: January 26th, 2017 | Author: | Filed under: Business News, Hard Pill to Swallow, News, Socially Engineered | Tags: , , , , , , , , , , , | Comments Off on Trump Has Become The Single Biggest Global Market Influence

How Trump has become the single biggest global market influence

You can be sure that when vast amounts of money move in a particular direction, somewhere, somehow, a powerful person, or group of powerful people, have made an important decision about something :: Read the full article »»»»


China Faces Currency Exchange Dilema

Posted: December 17th, 2010 | Author: | Filed under: China, Socially Engineered | Tags: , , | Comments Off on China Faces Currency Exchange Dilema

CHINA-NEWSChina faces a dilemma in managing its currency, since appreciation would benefit importers but anger exporters, central bank chief Zhou Xiaochuan said in comments reported on Friday.

As with all policy decisions, including whether to raise interest rates, the trick for the People’s Bank of China was to try to strike a balance between competing interests, he was cited as saying by the Shanghai Securities News, an official newspaper.

“Most central banks face a dilemma in their monetary policy, hoping to use limited tools to satisfy all of the demands from groups with different interests,” Zhou was quoted as saying. “Take the exchange rate. When the exchange rate rises, exporters will perhaps complain. Importers might say it is good. They will be able to sell things for a bit less and so expand their market. There will always be a trade-off.” :: Read the full article »»»»


Make a Buck

Posted: June 5th, 2009 | Author: | Filed under: Business News | Tags: , , , , | Comments Off on Make a Buck

Make A BuckYou can make a buck on the strength of the Australian dollar versus the Japanese yen. When central banks around the world decide to change targets for short-term interest rates, they become a big influence on the flow of funds around the globe, and the resulting changes in the relative value of particular currencies against others.

In the U.S., the Federal Reserve has cut the federal funds target rate down near levels where the Bank of Japan has long kept its primary rate at a measly 0.10%. At the same time, the Reserve Bank of Australia has sustained a higher benchmark rate of 3%.

In the U.S., the Federal Reserve has cut the federal funds target rate down near levels where the Bank of Japan has long kept its primary rate at a measly 0.10%. At the same time, the Reserve Bank of Australia has sustained a higher benchmark rate of 3%.

Imagine if you could borrow money from Japan and deposit it in Australia to capitalize on the rate difference. You can, many do, and it’s called the “carry trade.” When you open a trade on the AUD/JPY currency pair, you are, in effect, borrowing in Japan and lending in Australia.

Traders have already benefited from this trade, as the Australian dollar (AUD), or aussie, has appreciated significantly against the Japanese yen (JPY). The aussie is the base currency and is placed in the numerator position, while the yen is the denominator; this means if the currency pair line rises, the aussie is stronger relative to the yen. Of course, if the yen shows strength relative to the Aussie, the line will fall.