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What's happening to the US dollar?
Thread poster: Richard Bartholomew

Richard Bartholomew  Identity Verified
Germany
Local time: 00:28
Member (2007)
German to English
Dec 11, 2006

The 10 December 2006 edition of the Boston Sunday Globe ("With dollar tanking, Americans visiting Europe feel the pinch" by John Ward Anderson) quotes Philippe d'Arvisenet, chief economist at BNP Paribas in Paris as predicting 1.40 USD to the Euro by the end of next year's first quarter. It suggests that others believe the US dollar could fall to 1.90 USD per Euro if the Asians start selling off their dollar reserves.

Would it be wise to exchange dollars for Euros now if the money will be needed in the near future or are these predictions unreasonable? How is this situation affecting your business or travel plans?


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Steven Capsuto  Identity Verified
United States
Local time: 18:28
Spanish to English
+ ...
The situation is a two-sided coin Dec 11, 2006

Rich B. wrote:How is this situation affecting your business or travel plans?


Overall, I'd rather see a strong dollar, since I'd like to see my country have a strong economy.

Personally, it's good for business (the weaker the dollar gets, the more work I get from Britain and the E.U. countries) but it's very bad for my travel plans.


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Lawyer-Linguist  Identity Verified
Portugal
Local time: 23:28
Dutch to English
+ ...
Word of advice Dec 11, 2006

Rich B. wrote:

The 10 December 2006 edition of the Boston Sunday Globe ("With dollar tanking, Americans visiting Europe feel the pinch" by John Ward Anderson) quotes Philippe d'Arvisenet, chief economist at BNP Paribas in Paris as predicting 1.40 USD to the Euro by the end of next year's first quarter. It suggests that others believe the US dollar could fall to 1.90 USD per Euro if the Asians start selling off their dollar reserves.

Would it be wise to exchange dollars for Euros now if the money will be needed in the near future or are these predictions unreasonable? How is this situation affecting your business or travel plans?


I'm no economist and can't comment on how reasonable these predictions are.

However, many countries have laws relating to how long in advance currency can be sold/purchased, so from a legal viewpoint I suggest you check that out first if you're planning this.


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Angeliki Papadopoulou  Identity Verified
Greece
Local time: 01:28
English to Greek
+ ...
The dollar has been underperforming... Dec 11, 2006

... for a while now, based mainly on weak or flat economic data from the US including fewer manufacturing orders, no hint from the Fed on whether it will raise or drop interest rates any time soon, and the recent rate hike by the ECB in Europe. Will the value of the dollar deteriorate? It's hard to tell. It seems to be holding its own - at least it has done so in the past week. Whether it manages to overcome its difficulties remains to be seen. The European economy on the other hand is sending out strong signals and for the time being investor confidence is high. Bear in mind that we are talking about very fine balances and things may change from one minute to the next. Probably the best thing to do is not to make big moves - certainly change money if you need it - but don't change all of it. Read the news and keep informed and seek the advice of a financial adviser. This is a good site for financial information: http://biz.yahoo.com/top.html
I hope this is of some help!

Regards
Lina


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Mulyadi Subali  Identity Verified
Indonesia
Local time: 06:28
English to Indonesian
+ ...
opportunity to invest in euro Dec 11, 2006

i've been reading about this too. if you have some spare money, its good if you can invest it in euro, at least for short-term gain.

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Williamson  Identity Verified
United Kingdom
Local time: 23:28
Flemish to English
+ ...
Dollars and oil might become euros and oil. Dec 11, 2006

Iran, the 4th oil-producer in the world has decided not to accept dollars as payment for oil any longer. Instead oil is paid in euros. Should all oil-producing countries do this the U.S.-currency would be in trouble. Now, the U.S. financances its hughe debt, which started to grow after the Clinton years, by just printing dollars. You can only do that if there is one currency, accepted worldwide. Now,there are two. Should all oil-produceres want to be paid in euros, the U.S. would face an unforeseen economic decline and end up with a worthless $.

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Angeliki Papadopoulou  Identity Verified
Greece
Local time: 01:28
English to Greek
+ ...
Re: my post earlier Dec 11, 2006

To illustrate the point I made earlier regarding the volatility of the money markets, this was posted on yahoo just half an hour ago:

The Euro continues to fall – currently below $1.32

The euro continued to fall against the dollar, dropping below US$1.32 in anticipation of the Fed meeting this week.
The 12-nation currency was worth US$1.3182 marginally down from US$1.3200 in New York late Friday, at which time it lost nearly a cent following positive U.S. jobs data.

So there's no telling what exactly is going to happen, not really. One can make guesses based on available information and end up being ... wrong!

Small moves... baby steps... that's probably the best way to go!

Lina


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Richard Bartholomew  Identity Verified
Germany
Local time: 00:28
Member (2007)
German to English
TOPIC STARTER
Re: Word of advice Dec 11, 2006

Lawyer-Linguist wrote:
...
However, many countries have laws relating to how long in advance currency can be sold/purchased, so from a legal viewpoint I suggest you check that out first if you're planning this.


Thanks for the heads up. I'll write this on my list of questions to my banker. Does anyone here know whether Germany enforces laws governing this?


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Cetacea  Identity Verified
Switzerland
Local time: 00:28
English to German
+ ...
What countries? Dec 11, 2006

Lawyer-Linguist wrote:
However, many countries have laws relating to how long in advance currency can be sold/purchased, so from a legal viewpoint I suggest you check that out first if you're planning this.


I'd be curious to see a list of the many countries this applies to. As far as I know, anyone can buy a certain currency now, keep it in a box under their bed and spend it in two years' time. Or open an account in a foreign currency, provided the banks in that country offer this kind of service. I for one could have an account in euros and one in dollars--all I have to do is accept the risk of losing money on either one.

The only restriction I can think of refers to the kind of sums that are probably out of the reach of most of us...


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Dr. Jason Faulkner  Identity Verified
Local time: 17:28
Member (2006)
Spanish to English
It's a question of confidence Dec 11, 2006

It's true, Saddam Hussein was going to only accept Euros for oil payments once the sanctions were to be lifted. That was a big reason for the hurried invasion. It's a sign of things to come. Expect more oil exporting countries to start selling in Euros as the dollar continues to slide.

Living in Mexico, the saying goes "It's better to earn dollars than pesos." We've always been hyper-aware of currency fluctuations in Mexico because the peso gets slammed so hard every few years. Nowadays, everyone is trying to earn Euros. My medical equipment company used to give price quotes in dollars throughout Latin America. Since June, we have gone to quoting in Euros. The huge U.S. debt and the ongoing war, coupled with the vanishing manufacturing sector have made the dollar a risky bet, at least from our accountant's point of view.

The new saying is, "it's better to earn Euros than Dollars." I will start invoicing in Euros this January. Aint globalization great?

SaludoZ!
Jason


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Richard Bartholomew  Identity Verified
Germany
Local time: 00:28
Member (2007)
German to English
TOPIC STARTER
Guessing wrong Dec 12, 2006

Angeliki Papadopoulou wrote:
...
So there's no telling what exactly is going to happen, not really. One can make guesses based on available information and end up being ... wrong!

Small moves... baby steps... that's probably the best way to go!

Lina


Thank you for the good advice Lina.


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xxxIreneN
United States
Local time: 17:28
English to Russian
+ ...
Don't rush to underestimate the strongest single economy in the world Dec 12, 2006

Mexico was never even close to a ruler in global finance and economy. You can play with euros, it can turn into a great gain in a short-term - it did for me, the brand new Italian 1-bed flat with balcony and 1-car garage (not in Rome:-) purchased in 2002 for 79 US cents on a euro ($67K total for me), is now worth over 110K euros. I remember we started calculating in lires and ended up with euros at the closing. But please remember - US in no Ruanda and should the dollar become worthless, especially too fast, the entire world economy will meet the same fate.

Don't step into the"dot-com" rush twice.

Good luck with business decisions!
Irene

PS - the funny part is that superprofitable investment was the last thing on my mind, it was all about Italy:-)

[Edited at 2006-12-12 00:54]


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Ralf Lemster  Identity Verified
Germany
Local time: 00:28
English to German
+ ...
No currency controls in Germany Dec 12, 2006

Hi Rich,
Does anyone here know whether Germany enforces laws governing this?

I'm not aware of any currency controls in Germany. In fact, given that the euro is a freely convertible currency, I'd be very surprised if any EMU member had such controls in place.

Best regards,
Ralf


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Angeliki Papadopoulou  Identity Verified
Greece
Local time: 01:28
English to Greek
+ ...
As far as restrictions go... Dec 12, 2006

...I think that the only thing banks (and indeed governments) are concerned with is legalizing funds acquired from illegal activities. As we are obliged to issue invoices for our work, this is adequate proof of having legally earned the money, which we then can spend just as we please, buying dollars, euro, shares, mutual funds or what-have-you. Do bear in mind that it is always a good idea (a must, actually) to go through the professionals when making investment decisions, so ask your financial adviser before you buy, sell, or invest in general.

Regards
Lina


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