Dollar slumps to record low vs Euro

[Biblenuggetlady]

http://www.bloomberg.com/apps/news?pid=20670001&refer=worldwide&sid=aMtV.07BfeXg

July 18 (Bloomberg) -- The dollar fell to a record low against the euro and dropped versus the yen after Bear Stearns Cos. reported hedge fund losses, fueling speculation investors will spurn U.S. assets as the economy slows.

The dollar declined to an all-time low of $1.3824 against the euro at 12:58 p.m. in Tokyo from $1.3781 in New York yesterday. It dropped to 121.77 yen from 122.34. The yen rose to 168.35 per euro from 168.59. The U.S. currency may decline to $1.3830 per euro and 121.50 yen today, Saito said.

The dollar reached a 26-year low of $2.0525 against the pound. It weakened to 87.83 cents against the Australian dollar, the lowest since February 1989. The dollar has fallen against 13 of the 16 most-active currencies today after Bear Stearns yesterday told investors in one of its hedge funds that they won't get any money back.



But hey, the Dow is soaring...:rolleyes

[dpetty]

It did the same thing in 1929 as well........just before the crash.

[PlumBob]

Biblenuggetlady,

The devaluation of of the US dollar does present some interesting opportunities, though.

I currently have 2 items on e-bay, both clearly labeled "No international shipping." In 2 days I've had 3 inquires - from Canada, Germany, and France - not asking "would you please consider sending this to Germany" - but rather "How much to send to Germany?"

Now if only I just had a clue what it is that the Germans and French and Canadians would really really really like to have, and could get it cheap, I'd make a bundle.

PlumBob

[sad1987]

Well i don't know what if anything this means but just recently our (aussie) dollar has been near 89/90 us cents the highest levels apparently in at least 20 years! i think the lowest its got to was about 48 cents US.

[ChildOJesus]

I can see the Germans and French, but Canadians are just like us... their dollar is at one of the highest its been in history up to our dollar. To send to Canada is not much more than sending to a loved one in another state. :scratch What's the big deal about not sending to our sister country, Canada?

I'm a Canadian and I too would like to know why we were left out. What was for sale? I'm sure they'd have a better chance of selling their item if it included Canadians. We're right next door after all. I live in Toronto which is actually south on the map of several U.S. States. We have professional Baseball, Basketball, Hockey and more multi-ethnic restaurants than you can imagine including 4 Chinatowns... We are a large city, the fifth largest in North America. Don't leave us out, please.:)

[PlumBob]

CoJ, I'll send you my amateur radio antenna any time you want! :wave

[Bernardd]

Working for Advisors ... I have to laugh inside.... they are all excited that the Dow is climbing... they tell me I need to invest... well I'm not too worried how much money I have in my accounts... when I leave this planet its.. not coming with me. It will rot ... burn up when this old earth passes away.

The crash is coming... people are not ready for that. I try not to entertain the massive deaths that the next crash will cause. Once it crashes... I don't think it will get back up.

There is nothing wrong with preparing financially for the future. And despite what you may think, the market has proven itself the best long term investment.

You may not think the market will recover from some collapse you foresee on the not-too-distant horizon, but then again, you don't really know for sure. Of course, perhaps this imminent collapse will result in your being fired or laid off. Thus, why bother going to work tomorrow?

[Bernardd]

Biblenuggetlady,

The devaluation of of the US dollar does present some interesting opportunities, though.

I currently have 2 items on e-bay, both clearly labeled "No international shipping." In 2 days I've had 3 inquires - from Canada, Germany, and France - not asking "would you please consider sending this to Germany" - but rather "How much to send to Germany?"

Now if only I just had a clue what it is that the Germans and French and Canadians would really really really like to have, and could get it cheap, I'd make a bundle.

PlumBob

The "slumping" dollar actually lowers the cost for American goods overseas. Hence, it creates jobs and increases wages.

[Biblenuggetlady]

Update 7/23/07
http://investing.reuters.co.uk/news/articleinvesting.aspx?rpc=401&type=usDollarRpt&storyID=2007-07-24T003411Z_01_T231700_RTRIDST_0_MARKETS-FOREX.XML

FOREX-Dollar at 2-month low vs yen, near record low vs euro

TOKYO, July 24 (Reuters) - The dollar fell to a two-month low against the yen and hovered near a record low against the euro on Tuesday as worries about U.S. subprime mortgage woes hurting the credit market and the economy still weighed.

Traders said market sentiment remained bearish for the dollar, and players were awaiting U.S. economic data later in the week for clues on whether the problems in the housing sector were spreading to broader economic activity.

The market shrugged off comments from U.S. Treasury Secretary Henry Paulson, who said problems in the subprime mortgage loan sector could be contained and would not hurt the overall economy. He also said a strong dollar was in the U.S. interest.

"The dollar remains top-heavy as it has not risen despite such favourable factors as a rise in U.S. stocks and comments from Paulson," said the head of foreign-exchange sales at a European bank.


"This shows how players remain deeply doubtful of the dollar's strength," he said. "Players want to see key data due later in the session. Right now there is no strong buying interest."

[PlumBob]

The "slumping" dollar actually lowers the cost for American goods overseas. Hence, it creates jobs and increases wages.True, to an extent. There is actually some empirical evidence that suggests that for every 10% that the US dollar is devalued (against foreign currencies) the profitability of US companies selling abroad goes up 1.5% - due to increased sales, as you indicated.

The question in my mind is - how low can it go. Regrettably, the sale of US goods abroad is not the only piece of the puzzle.