1.93's A$ to the Pound!!!
May 25th 2010, 5:24 am
#1666
Forum Regular
Joined: Aug 2007
Location: UK again
Posts: 219
Re: 1.93's A$ to the Pound!!!
AUD seems to have taken a turn for the worse again today, just gone below the 82cents mark. Oz shares have lost yesterdays gains.
May 25th 2010, 10:52 am
#1667
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Joined: Feb 2008
Location: Hope Island, Gold Coast
Posts: 1,920
Re: 1.93's A$ to the Pound!!!
Basically whenever the equity markets drop, the AUD drops, its seen as a risk-asset. For those of us that think that the economic worst is ahead, this bodes badly for the AUD, IMHO DYODD.
May 25th 2010, 11:26 am
#1668
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Joined: Aug 2008
Location: Gloucestershire
Posts: 2,201
Re: 1.93's A$ to the Pound!!!
I know absolutely nothing about finance so won't pretend I do. However, I've noticed that very often when the footsy(?) drops you get more £ for $. Is this the case, if so, why?
May 25th 2010, 12:49 pm
#1670
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Re: 1.93's A$ to the Pound!!!
Its a very long story and I don't prentend to know it all but basically the AUD is strongly linked to industrial production, China & others buy copper, alu etc from Australia to make cars & electronics etc, when the markets turn down the expectation is that there will be less demand. The AUD does badly when markets turn "risk averse" and share prices fall.
There is also the Carry Trade where large investors borrow in low yield (interest) currencies (like the JPY) and invest in high yield ones like the AUD, when the tide turns and the JPY appreciated (as it is hugely today) the AUD gets sold to "unwind" or close off the trade, again causing the AUD to fall.
I've made a lash of explaining that but hopefully you get my drift.
BTW I feel the economic recovery is an aborration caused by western govts printing money & spending like drunken sailors in a misguided effort to end the recession, they've just delayed it & made it a whole lot worse, the thesis seems to be "we have too much debt, borrow lots more to keep the party going".
Last edited by freebo; May 25th 2010 at 12:53 pm.
May 25th 2010, 12:58 pm
#1671
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Posts: 2,201
Re: 1.93's A$ to the Pound!!!
Its more AUD for £ but I'm sure you mean that.
Its a very long story and I don't prentend to know it all but basically the AUD is strongly linked to industrial production, China & others buy copper, alu etc from Australia to make cars & electronics etc, when the markets turn down the expectation is that there will be less demand. The AUD does badly when markets turn "risk averse" and share prices fall.
There is also the Carry Trade where large investors borrow in low yield (interest) currencies (like the JPY) and invest in high yield ones like the AUD, when the tide turns and the JPY appreciated (as it is hugely today) the AUD gets sold to "unwind" or close off the trade, again causing the AUD to fall.
I've made a lash of explaining that but hopefully you get my drift.
BTW I feel the economic recovery is an aborration caused by western govts printing money & spending like drunken sailors in a misguided effort to end the recession, they've just delayed it & made it a whole lot worse, the thesis seems to be "we have too much debt, borrow lots more to keep the party going".
Its a very long story and I don't prentend to know it all but basically the AUD is strongly linked to industrial production, China & others buy copper, alu etc from Australia to make cars & electronics etc, when the markets turn down the expectation is that there will be less demand. The AUD does badly when markets turn "risk averse" and share prices fall.
There is also the Carry Trade where large investors borrow in low yield (interest) currencies (like the JPY) and invest in high yield ones like the AUD, when the tide turns and the JPY appreciated (as it is hugely today) the AUD gets sold to "unwind" or close off the trade, again causing the AUD to fall.
I've made a lash of explaining that but hopefully you get my drift.
BTW I feel the economic recovery is an aborration caused by western govts printing money & spending like drunken sailors in a misguided effort to end the recession, they've just delayed it & made it a whole lot worse, the thesis seems to be "we have too much debt, borrow lots more to keep the party going".
Thanks very much for the explanation.
May 25th 2010, 1:09 pm
#1672
Shiny Arse Know All
Joined: Apr 2010
Location: Adelaide, somewhere
Posts: 14,180
Re: 1.93's A$ to the Pound!!!
Its more AUD for £ but I'm sure you mean that.
Its a very long story and I don't prentend to know it all but basically the AUD is strongly linked to industrial production, China & others buy copper, alu etc from Australia to make cars & electronics etc, when the markets turn down the expectation is that there will be less demand. The AUD does badly when markets turn "risk averse" and share prices fall.
There is also the Carry Trade where large investors borrow in low yield (interest) currencies (like the JPY) and invest in high yield ones like the AUD, when the tide turns and the JPY appreciated (as it is hugely today) the AUD gets sold to "unwind" or close off the trade, again causing the AUD to fall.
I've made a lash of explaining that but hopefully you get my drift.
BTW I feel the economic recovery is an aborration caused by western govts printing money & spending like drunken sailors in a misguided effort to end the recession, they've just delayed it & made it a whole lot worse, the thesis seems to be "we have too much debt, borrow lots more to keep the party going".
Its a very long story and I don't prentend to know it all but basically the AUD is strongly linked to industrial production, China & others buy copper, alu etc from Australia to make cars & electronics etc, when the markets turn down the expectation is that there will be less demand. The AUD does badly when markets turn "risk averse" and share prices fall.
There is also the Carry Trade where large investors borrow in low yield (interest) currencies (like the JPY) and invest in high yield ones like the AUD, when the tide turns and the JPY appreciated (as it is hugely today) the AUD gets sold to "unwind" or close off the trade, again causing the AUD to fall.
I've made a lash of explaining that but hopefully you get my drift.
BTW I feel the economic recovery is an aborration caused by western govts printing money & spending like drunken sailors in a misguided effort to end the recession, they've just delayed it & made it a whole lot worse, the thesis seems to be "we have too much debt, borrow lots more to keep the party going".
This drunken sailor is a tightwad, just ask the wife
May 25th 2010, 6:16 pm
#1673
Waiting to be a grown-up
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Posts: 4,695
May 25th 2010, 7:07 pm
#1674
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May 25th 2010, 7:22 pm
#1675
Shiny Arse Know All
Joined: Apr 2010
Location: Adelaide, somewhere
Posts: 14,180
May 25th 2010, 7:42 pm
#1676
Waiting to be a grown-up
Joined: May 2010
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Posts: 4,695
then
May 25th 2010, 9:42 pm
#1677
BE Enthusiast
Thread Starter
Joined: Jun 2008
Posts: 730
Re: 1.93's A$ to the Pound!!!
Its more AUD for £ but I'm sure you mean that.
Its a very long story and I don't prentend to know it all but basically the AUD is strongly linked to industrial production, China & others buy copper, alu etc from Australia to make cars & electronics etc, when the markets turn down the expectation is that there will be less demand. The AUD does badly when markets turn "risk averse" and share prices fall.
There is also the Carry Trade where large investors borrow in low yield (interest) currencies (like the JPY) and invest in high yield ones like the AUD, when the tide turns and the JPY appreciated (as it is hugely today) the AUD gets sold to "unwind" or close off the trade, again causing the AUD to fall.
I've made a lash of explaining that but hopefully you get my drift.
BTW I feel the economic recovery is an aborration caused by western govts printing money & spending like drunken sailors in a misguided effort to end the recession, they've just delayed it & made it a whole lot worse, the thesis seems to be "we have too much debt, borrow lots more to keep the party going".
Its a very long story and I don't prentend to know it all but basically the AUD is strongly linked to industrial production, China & others buy copper, alu etc from Australia to make cars & electronics etc, when the markets turn down the expectation is that there will be less demand. The AUD does badly when markets turn "risk averse" and share prices fall.
There is also the Carry Trade where large investors borrow in low yield (interest) currencies (like the JPY) and invest in high yield ones like the AUD, when the tide turns and the JPY appreciated (as it is hugely today) the AUD gets sold to "unwind" or close off the trade, again causing the AUD to fall.
I've made a lash of explaining that but hopefully you get my drift.
BTW I feel the economic recovery is an aborration caused by western govts printing money & spending like drunken sailors in a misguided effort to end the recession, they've just delayed it & made it a whole lot worse, the thesis seems to be "we have too much debt, borrow lots more to keep the party going".
Double dip or 'W' shaped recession was always highly likely with international governments approach to it all!
Australia has always been behind the curve as well by a year or 2. In the early 90's last recession I was working in Sydney and got made redundant
, struggled for 6 months to find a job and no chance. Came back to UK for a wedding and found a country which was already out of recession and things on the up. Got offered brilliant job after hours of trying and ended up staying years and riding the property boom of late 90's! Was 2 years after I left that Oz started to recover!So my prediction is Australia still to be hit and then we'll see if cocky Rudd has helped or hindered things by throwing cash at consumers to spend (who saved it or paid off debts rather than spend it) and trapped first time buyers into properties that they ended up paying higher prices for thanks to increasing the first home buyers grant (which sellers immediately incresed properties by same amount.) Especially now interest rates are on the up and those first time buyers are finding mortgage harder to pay off each month if they overstretched to buy in first place!!??
Add increasing property values comparable with property bubble in US and UK (and Europe) prior to the mighty burst that started this whole thing off in the first place.
It all makes grim reading!
May 25th 2010, 10:40 pm
#1678
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Location: newbury
Posts: 943
Re: 1.93's A$ to the Pound!!!
The whole reason we are waiting 18 months ( visa validated 2010) Houses up uk & down oz plus over $2.00 to the £ fingers x by then. Those who have paniced with the riseing exchange rates GET A GRIP & stay calm.
May 26th 2010, 12:27 am
#1679
Account Closed
Joined: Jul 2006
Posts: 14,188
Re: 1.93's A$ to the Pound!!!
Sorry to disapoint folks, but there is never the right time to exchange.
Keep waiting and you might get lucky... or keep waiting and you might get screwed.
I can remember people waiting for 'things to improve' when it was $2.40 to the pound. I assume those people are still waiting.
Keep waiting and you might get lucky... or keep waiting and you might get screwed.
I can remember people waiting for 'things to improve' when it was $2.40 to the pound. I assume those people are still waiting.
May 26th 2010, 12:48 am
#1680
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Joined: Feb 2008
Location: Hope Island, Gold Coast
Posts: 1,920
Re: 1.93's A$ to the Pound!!!
Sorry to disapoint folks, but there is never the right time to exchange.
Keep waiting and you might get lucky... or keep waiting and you might get screwed.
I can remember people waiting for 'things to improve' when it was $2.40 to the pound. I assume those people are still waiting.
Keep waiting and you might get lucky... or keep waiting and you might get screwed.
I can remember people waiting for 'things to improve' when it was $2.40 to the pound. I assume those people are still waiting.
I bought the last of what I need to get us started, buy a new car etc last week at 1.76. If/when it improves I'll buy some more but no rush for now as I'll get my first AUD pay in a couple of weeks.
I do think there's risk in being fully invested in anything though (and I include cash in any currency and property in that), so my savings are balanced across several (hopefully) non-correlated investments including Gold bullion.
