Posts Tagged ‘ credit crisis ’
With this post, I want to try to clarify the Greek fiscal crisis. The problem is that it’s not clear exactly how serious the problem is, because most of the media coverage of the crisis has been directed towards the financial markets’ perception of it, rather than its underlying fundamentals. In the end, I think [ READ MORE ]
Currency markets operate in funny ways. Greece’s fiscal problems are hardly a new development. During years of boom and bust alike, it ran unsustainable budget deficits. Why investors have decided to fret now – as opposed to last year or next year, for example – on the distant possibility of default, is somewhat mysterious. After all, [ READ MORE ]
A full-fledged meltdown in the forex markets is the best way to describe today’s price action as investors sought safety in the low yielding U.S. dollar. The greenback rose against every major currency except for the Japanese Yen which further indicates that risk aversion is behind today’s strong demand for dollars. Do not [ READ MORE ]
Let me preface this post, by noting that I try to avoid writing about gold, since there are some many other excellent analysts out there writing about the subject. But when there is a such a strong overlap between gold and forex markets, well, I just can’t resist! Recently, gold prices have collapsed at virtually the [ READ MORE ]
The Chinese Yuan (RMB) spent all of 2009 pegged to the Dollar at 6.83. Since the Dollar depreciated against almost every other currency during that time period, the Yuan has fallen against these currencies, undoing most of its appreciation in 2008. As a result of both international pressure and internal economic conditions, however, the Yuan’s [ READ MORE ]
In some ways, 2009 was a wild year in forex markets. Compared to 2008, however, it was relatively tame. And that is all I have to say about forex in 2009. Ah, if only it were that simple… The year began as a continuation of 2008. Global capital markets were still in the throes of the credit [ READ MORE ]
The Korean Won is up 32% since March, and 8.2% on the year. At the same time, it is 20% below is 2007 year-end level, as well as 13% weaker than the 2006 average of 955 and 15.5% weaker than the 2007 average. Focusing only on the Won’s appreciation would probably cause some technical analysts to [ READ MORE ]
Many analysts are pointing to Friday, December 4, as the day that logic returned to the forex markets. On that day, the scheduled release of US non-farm payrolls indicated a drop in the unemployment rate and shocked investors. This was noteworthy in and of itself (because it suggests that the recession is already fading), but [ READ MORE ]
While the Indian Rupee has risen more than 10%, since bottoming in March, it has increased only 4.3% in value in the year-to-date. Still, given how turbulent the first few months of 2009 were (a continuation of 2008, really), this modest appreciation was actually the third highest, among Asian currencies, behind only the Indonesian Rupiah [ READ MORE ]
Euro was under relentless assault in early morning European trade today, after reports on the website http://www.benzinga.com suggested that Austria may be the latest trouble spot for the credit crisis spreading throughout the region. The Austrian regulators have already nationalized Carinthian Hypo Alpe Adria Bank AG and speculation is mounting that Austria’s fourth largest [ READ MORE ]
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