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Mesogen
12-21-2007, 03:14 PM
http://www.moneymorning.com/2007/11/21/nine-ways-to-profit-from-the-diving-dollar/


Let me put it bluntly: The U.S. dollar is nose-diving against foreign currencies. So far, itís down 12% against the euro, 7% to the yen, 8% to the pound, 15% to the Canadian dollar, and 10% to the Swiss frank. And thatís just in the past year alone.


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Thankfully, there are simple solutions to these currency conundrums.

By holding assets denominated in foreign currencies, U.S. investors can protect their savings from the twin assaults of inflation and currency devaluation. In dollar terms, the value of assets held outside the United States will grow in a gratifying fashion - as will the profits you reap from these strategies.

It looks like the general solution is "go global." Buy foreign stocks and invest in foreign currencies.

But if millions of people did this, wouldn't that weaken the dollar even further?

Hmm. The Fed keeps lowering interest rates and the best solution looks like global investment. Hmm.

MaulNutz
12-21-2007, 03:39 PM
What about buying gold and silver?

seapilot
12-21-2007, 03:54 PM
What about buying gold and silver?

Technically there is no profit in Gold or Silver it just preserves the value of wealth. The dollar goes down it just takes more dollars to buy gold, silver and other currencies. Want profit invest in a business or foriegn companies stock and energy.

beobeli
12-21-2007, 04:04 PM
Technically there is no profit in Gold or Silver it just preserves the value of wealth. The dollar goes down it just takes more dollars to buy gold, silver and other currencies. Want profit invest in a business or foreign companies stock and energy.

The irony is that you would have to pay tax on the "gain" of the gold/silver investment. As you said there is no gain here, just "net zero" preservation of value. But the government would want a cut, thus imposing disincentive on investment in gold/silver as a "competing" currency. Ron Paul talked about this.

beobeli
12-21-2007, 04:08 PM
One thing I was wandering is how can Fed run the dollar value down internationally and still preserve prices, at least for not, domestically. The only explanation I have is that the foreign suppliers are forced to take a pay-cut. This means that the Fed is imposing "inflation tax" on the foreign suppliers by which the value is suctioned out of their pockets too. If it continue like this, those suppliers will find new markets, or eventually start charging higher prices. Oil and gas are probably one such commodity where the adjustment is instantaneous.