Realistbear Posted August 18, 2010 Share Posted August 18, 2010 http://uk.finance.yahoo.com/news/us-and-china-to-clash-over-yuan-fall-tele-2782247a16ea.html?x=0 US and China to clash over yuan fall Ambrose Evans-Pritchard, 15:42, Wednesday 18 August 2010 China is on a collision course with Washington after steering its currency sharply lower to protect its export industries, despite a near record trade surplus of $29bn (£19bn) in July. The yuan dropped at the fastest pace in almost two years last week and is now 1.8pc lower against a basket of currencies than in June, when Beijing announced the end to its fixed peg against the dollar. Nothing like success to lower your currency's value-what. China is now the 2nd largest econonmy so it may be a battle of the titans to see who can lower their currency the most and push the other out of the market. If China and the US both devalue vs. the Euro they could lay the EU to waste in days. Quote Link to comment Share on other sites More sharing options...
NotMyHouse Posted August 18, 2010 Share Posted August 18, 2010 And if that happens, what will happen to gold? Quote Link to comment Share on other sites More sharing options...
AteMoose Posted August 18, 2010 Share Posted August 18, 2010 (edited) IMHO the Euro, Pound are also falling... Edited August 18, 2010 by AteMoose Quote Link to comment Share on other sites More sharing options...
Stay Beautiful Posted August 18, 2010 Share Posted August 18, 2010 And if that happens, what will happen to gold? Nohing. Its not easily destructable, it will still be yellow. Quote Link to comment Share on other sites More sharing options...
xux42 Posted August 18, 2010 Share Posted August 18, 2010 http://uk.finance.yahoo.com/news/us-and-china-to-clash-over-yuan-fall-tele-2782247a16ea.html?x=0 US and China to clash over yuan fall The Yanks seem to keep getting angry - N. Korea, Iran, BP, China, Mexican Illegals... When that happens in my family its usually cos' deep down the individual is angry with themself.... Quote Link to comment Share on other sites More sharing options...
MrFlibble Posted August 18, 2010 Share Posted August 18, 2010 China is on a collision course with Washington after steering its currency sharply lower to protect its export industries, despite a near record trade surplus of $29bn (£19bn) in July. Did they hire Gordon Brown? He can work wonders on any currency Quote Link to comment Share on other sites More sharing options...
Realistbear Posted August 18, 2010 Author Share Posted August 18, 2010 And if that happens, what will happen to gold? Its an interesting scenario as it appears that everyone and their second cousin are trying to devalue in the face of the incoming recession/depression. If they all devalue then no one devalues and the staus quo remains. China seem to be leading the race to the "bottom" while retaining the strongest GDP growth which presents an odd situation as a currency normally falters in the face of declining economic prospects. Then again, the pound has been faring well and we probably have among the worst prospects of any other Western nation apart from, possibly, PIIGS. The US will try to devalue again when things get rougher to try to eliminate the EU from the competition as they did under Paulson's tenure and his "strong dollar policy" which was, of course, meant to deliver the opposite.--which it did, rather successfully. This is frustrating for gold investors and possibly why the price of gold has remained range bound for so long. If the range remains tight for much longer the break out will be to the downside IMO and that is when we will have the gold crash--so long delayed. Quote Link to comment Share on other sites More sharing options...
Injin Posted August 18, 2010 Share Posted August 18, 2010 Its an interesting scenario as it appears that everyone and their second cousin are trying to devalue in the face of the incoming recession/depression. If they all devalue then no one devalues and the staus quo remains. Quote Link to comment Share on other sites More sharing options...
DisQ Posted August 18, 2010 Share Posted August 18, 2010 Quote Link to comment Share on other sites More sharing options...
crash2006 Posted August 18, 2010 Share Posted August 18, 2010 Its an interesting scenario as it appears that everyone and their second cousin are trying to devalue in the face of the incoming recession/depression. If they all devalue then no one devalues and the staus quo remains. China seem to be leading the race to the "bottom" while retaining the strongest GDP growth which presents an odd situation as a currency normally falters in the face of declining economic prospects. Then again, the pound has been faring well and we probably have among the worst prospects of any other Western nation apart from, possibly, PIIGS. The US will try to devalue again when things get rougher to try to eliminate the EU from the competition as they did under Paulson's tenure and his "strong dollar policy" which was, of course, meant to deliver the opposite.--which it did, rather successfully. This is frustrating for gold investors and possibly why the price of gold has remained range bound for so long. If the range remains tight for much longer the break out will be to the downside IMO and that is when we will have the gold crash--so long delayed. said this way beck in 2007, its a race to the bottom as each country devalues its own currency. Quote Link to comment Share on other sites More sharing options...
Take Me Back To London! Posted August 18, 2010 Share Posted August 18, 2010 This is frustrating for gold investors and possibly why the price of gold has remained range bound for so long. If the range remains tight for much longer the break out will be to the downside IMO and that is when we will have the gold crash--so long delayed. Last week marked the tenth consecutive up year in gold. Very frustrating! Quote Link to comment Share on other sites More sharing options...
Fishfinger Posted August 18, 2010 Share Posted August 18, 2010 And if that happens, what will happen to gold? The usual... another upward year. Please bear in mind that the Chinese are seriously accumulating gold...and then again so are the Saudi's..come to think of it so are the Russians. Quote Link to comment Share on other sites More sharing options...
Fishfinger Posted August 18, 2010 Share Posted August 18, 2010 .This is frustrating for gold investors and possibly why the price of gold has remained range bound for so long. If the range remains tight for much longer the break out will be to the downside IMO and that is when we will have the gold crash--so long delayed. One day RB, perhaps one day, sometime in the future, at an undetermined date, subject to the whims of the gods and the alignment of the planets, you may actually be right! Quote Link to comment Share on other sites More sharing options...
NotMyHouse Posted August 18, 2010 Share Posted August 18, 2010 Sorry, should I have said "And what will happen to gold, nudge nudge, say no more, say NO more!" If all other currencies are in a race to the bottom, gold, the currency you cannot print, will be trumps. Quote Link to comment Share on other sites More sharing options...
Errol Posted August 18, 2010 Share Posted August 18, 2010 Did someone say gold price crash? I do hope so! We need gold cheaper. It's too expensive at the moment. Quote Link to comment Share on other sites More sharing options...
Stay Beautiful Posted August 18, 2010 Share Posted August 18, 2010 a world of all fiat currencies devaluing quickly at once? If it is the case, then, get me some sound money! Wheres that inverted triangle diagram when you need it? Quote Link to comment Share on other sites More sharing options...
Johnny Storm Posted August 18, 2010 Share Posted August 18, 2010 (edited) Who knows. Is it time to buy gold??? Edited August 18, 2010 by Johnny Storm Quote Link to comment Share on other sites More sharing options...
Errol Posted August 18, 2010 Share Posted August 18, 2010 (edited) Wheres that inverted triangle diagram when you need it? Edited August 18, 2010 by Errol Quote Link to comment Share on other sites More sharing options...
Realistbear Posted August 18, 2010 Author Share Posted August 18, 2010 Last week marked the tenth consecutive up year in gold. Very frustrating! Up by how much YoY? So much risk and so little reward. That said, good for those that got in at the bottom and sold when it approached the top. Its all a question of when you bought and when you sold as there is no greater loss than the profit you are always going to make. Quote Link to comment Share on other sites More sharing options...
Realistbear Posted August 18, 2010 Author Share Posted August 18, 2010 a world of all fiat currencies devaluing quickly at once? If it is the case, then, get me some sound money! Wheres that inverted triangle diagram when you need it? If everyone devalues by 50% at the same time relative value remains the same. Currency is worth what someone will exchnage you for it. A Franc devalued 50% is worth the same against a similarly devalued Yen. Gold, or any other commodity, is worth what someone will giv e you in exchnage for it. Value remains in constant flux which is why all things that are used to buy and sell are fiat. Quote Link to comment Share on other sites More sharing options...
Injin Posted August 18, 2010 Share Posted August 18, 2010 If everyone devalues by 50% at the same time relative value remains the same. only if they produce 50% more goods and services! Currency is worth what someone will exchnage you for it. A Franc devalued 50% is worth the same against a similarly devalued Yen. Dunno about you, RB. But I eat food and burn gas. Gold, or any other commodity, is worth what someone will giv e you in exchnage for it. Value remains in constant flux which is why all things that are used to buy and sell are fiat. Fiat means imposed by force. Quote Link to comment Share on other sites More sharing options...
Errol Posted August 18, 2010 Share Posted August 18, 2010 The top could be anywhere around $5000 an ounce plus. Quite a long way to go yet. Quote Link to comment Share on other sites More sharing options...
Stay Beautiful Posted August 18, 2010 Share Posted August 18, 2010 thanks. Quote Link to comment Share on other sites More sharing options...
Realistbear Posted August 18, 2010 Author Share Posted August 18, 2010 (edited) only if they produce 50% more goods and services! Dunno about you, RB. But I eat food and burn gas. Fiat means imposed by force. Aha ha! You have got it. Fiat is imposed by force. And markets forces are that which create fiats--in all things thaty are bought and sold whether it be metals, corn or other currencies. The market determines price--the force that is applied is determined by supply, demand and price. If all currencies devalue equally you have relative stasis. Price will drive down demand if no one can afford to buy the loaf that is doubled in price relative to all currencies that are in play. Nash's theory of demand in very simple terms. The outcome of seemingly random market forces is predictable if you can see the relative market forces in play--thus equal devaluation will have equal effect on demand and the price will be determined by the forces that are set in motion in any given subset. Edited August 18, 2010 by Realistbear Quote Link to comment Share on other sites More sharing options...
Stay Beautiful Posted August 18, 2010 Share Posted August 18, 2010 If everyone devalues by 50% at the same time relative value remains the same. Currency is worth what someone will exchnage you for it. A Franc devalued 50% is worth the same against a similarly devalued Yen. Gold, or any other commodity, is worth what someone will giv e you in exchnage for it. Value remains in constant flux which is why all things that are used to buy and sell are fiat. See the big upside down triangle thing. Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.