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The good old british quid

The good old british quid

Old May 24th 2011, 6:47 am
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Default The good old british quid

Well it is almost 2 for 1 agin. The Fonterra payout seems to have really bouyed the kiwi. As ever all the pundits are going on how over valued it is and if things were not bad enough NZ has just put out 20 billion $$ worth of bonds that the chinese are buying with relish only adding to the strength of the kiwi $.

It will surely go south of 2 for 1. I was of a mind when it was 2.25ish to do a big forex deal but could not bring myself to do it. Seems like yet again I was wrong, as I was with Telecom shares. Was tempted to buy at $2 a few months ago, looked like good value. $2.40ish now if I heard the radio right!!

BUT some wiser folk are of the belief that NZ is getting soooooooooooooo wound up with debt, apparently the country's total debt (private and commercial) is 90% of GDP.

In short they think that the writing is on the wall and the house of cards that is the madly overvalued kiwi and the over leveraged economy of NZ will ultimately fail and crash.

I wonder how long we will have to wait? The recent budget and the optimistic figures bandied about apparently will not come to fruition. We are all doomed..economically speaking.
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Old May 24th 2011, 7:31 am
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Default Re: The good old british quid

Originally Posted by Genesis View Post
Well it is almost 2 for 1 agin. The Fonterra payout seems to have really bouyed the kiwi. As ever all the pundits are going on how over valued it is and if things were not bad enough NZ has just put out 20 billion $$ worth of bonds that the chinese are buying with relish only adding to the strength of the kiwi $.

It will surely go south of 2 for 1. I was of a mind when it was 2.25ish to do a big forex deal but could not bring myself to do it. Seems like yet again I was wrong, as I was with Telecom shares. Was tempted to buy at $2 a few months ago, looked like good value. $2.40ish now if I heard the radio right!!

BUT some wiser folk are of the belief that NZ is getting soooooooooooooo wound up with debt, apparently the country's total debt (private and commercial) is 90% of GDP.

In short they think that the writing is on the wall and the house of cards that is the madly overvalued kiwi and the over leveraged economy of NZ will ultimately fail and crash.

I wonder how long we will have to wait? The recent budget and the optimistic figures bandied about apparently will not come to fruition. We are all doomed..economically speaking.
Could be an interesting election if it happens before November...
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Old May 24th 2011, 7:31 am
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Default Re: The good old british quid

Still disbelieve in the long term trend eh?
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Old May 24th 2011, 7:34 am
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Default Re: The good old british quid

The Government predictions for miraculous recovery came about because the economy is effectively getting an injection of ten billion dollars of insurance monies for the Christchurch rebuild. I saw some graphs that showed the predictions for when the Government were expecting to return to surpluses pre and post earthquake. The original recovery time was expected to to be something like 15 years out from now and has now I believe been reduced to four years.

Here's what Bernard Hickey has to say:

http://www.nzherald.co.nz/business/n...ectid=10727171

Not forgetting also the plan to raise $5 to 7 billion by privatising a few power companies.

http://www.nzherald.co.nz/business/n...ectid=10726458

Last edited by Bo-Jangles; May 24th 2011 at 7:43 am.
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Old May 24th 2011, 9:07 am
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Default Re: The good old british quid

Originally Posted by simonsi View Post
Still disbelieve in the long term trend eh?
Yep, because its bouncing around like a pogo stick. It did this a few months ago..then it shot up to $2.25, change, change,change, change..it is not a trend. It is shite but it's not a trend. You think it is we will beg to differ. Did you know the kiwi is one of the most traded currencies on earth? You simply don't have trends with such a volatile currency.
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Old May 24th 2011, 9:47 am
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Default Re: The good old british quid

Originally Posted by Genesis View Post
Did you know the kiwi is one of the most traded currencies on earth? You simply don't have trends with such a volatile currency.
Volume is irrelevant, what do you think the NZ$ is traded for? Washers? No, its other currencies. Bit like saying "there are more buyers than sellers", rubbish, each such trade has a buyer and seller on each side, anything else is just interest but doesn´t make you a buyer (or a seller, ask anyone in the UK property market....).

Average the "volatile rate" for any period you choose, then plot the movement against equivalent periods in the past. You can trend anything. If you choose to.

Fight the trend if you must but if you aren´t VERY careful, it´ll bite you - as it already has.
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Old May 24th 2011, 9:52 am
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Default Re: The good old british quid

Originally Posted by simonsi View Post
Volume is irrelevant, what do you think the NZ$ is traded for? Washers? No, its other currencies. Bit like saying "there are more buyers than sellers", rubbish, each such trade has a buyer and seller on each side, anything else is just interest but doesn´t make you a buyer (or a seller, ask anyone in the UK property market....).

Average the "volatile rate" for any period you choose, then plot the movement against equivalent periods in the past. You can trend anything. If you choose to.

Fight the trend if you must but if you aren´t VERY careful, it´ll bite you - as it already has.
I guess you are very trendy! I am not. I have not been bitten yet as you suggest as I have not sold any pounds at this shite rate. And I won't unless your apparent trend changes in my favour. It will stay in the UK for my trips there and ultimately onto my children when I shuffle off this mortal coil.
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Old May 24th 2011, 10:51 am
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Default Re: The good old british quid

Originally Posted by Genesis View Post
...I was of a mind when it was 2.25ish to do a big forex deal but could not bring myself to do it. Seems like yet again I was wrong, as I was with Telecom shares.
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Old May 24th 2011, 5:50 pm
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Default Re: The good old british quid

Originally Posted by simonsi View Post
Why on earth does my view on the kiwi rattle you so much Simon??????????????????
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Old May 24th 2011, 6:22 pm
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Default Re: The good old british quid

Rattle? No, but post the same mathematical untruths and you can expect the same response, and I wouldn't want anyone to sit on GBP without understanding the long term risk of doing so. Many in the UK are hoping for house prices to rise and solve their problems, at least the long term trend is in their favour along with some fundamental truths such as rising population and limited land available which drive that trend. There are no such factors driving the Kiwi to be weaker against the GBP, hence the trend down, hence "sit and wait" is doomed as a forex plan.

Become a technical trader and take advantage of the volatility by all means but beware, technical traders take money off wishful thinkers all the time and know a trend when they see one.
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Old May 24th 2011, 8:11 pm
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Default Re: The good old british quid

Originally Posted by simonsi View Post
Rattle? No, but post the same mathematical untruths and you can expect the same response, and I wouldn't want anyone to sit on GBP without understanding the long term risk of doing so. Many in the UK are hoping for house prices to rise and solve their problems, at least the long term trend is in their favour along with some fundamental truths such as rising population and limited land available which drive that trend. There are no such factors driving the Kiwi to be weaker against the GBP, hence the trend down, hence "sit and wait" is doomed as a forex plan.

Become a technical trader and take advantage of the volatility by all means but beware, technical traders take money off wishful thinkers all the time and know a trend when they see one.
Thank you for your sage advice. Why would I be doomed if I sit and wait? I do not need the money here. Yes I would prefer it here as it earns more interest in NZ than in the UK.....but as I said it is surplus and we have more than enough $$s in NZ both in earnings and savings.

Now if you go with your doomed plan and people took a knee jerk rection when it plumetted to 2 a while back they would have missed out on the opportunity of 2.25 a mere month or two later.

It is a roller coaster. Up and down. If the pound is on a downward trend it will literally be utterly, utterly worthless in a matter of years if you take your 'trend' idea to its enth degree. That is not going to happen. A while back the pound was worth a huge amount. Back in the early 2000s it was almost 4 for a pound. Not doubt you would have called that a trend. But it wasn't was it? Just the simple machinations of forex. Action, reaction.
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Old May 24th 2011, 8:23 pm
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Default Re: The good old british quid

I just hope its nearer >2.1 when we transfer some funds at the end of July
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Old May 25th 2011, 1:52 am
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Default Re: The good old british quid

Originally Posted by Genesis View Post
Thank you for your sage advice. Why would I be doomed if I sit and wait?
Because your plan seems forever "wait for 3:1 to return". The trend makes that highly unlikley.

The NZ$ vs £ rate is trending to a value, what the value is I have no idea except it is still trending down, it may trend down to 2, 1.5, 1, whatever, the point is that it is still trending downwards so waiting just pushes you down the trend further.

Hmmm, well if the value has no implications for you why are you so worried about it?

Yes, change at 2 you would have missed the bounce to 2.25. That is technical trading (ie you take a figure because it gives you a profit vs another figure that presumably you bought at). If you do that against a background of the trend being down that is fine. If you buy at 2 hoping for 3 anytime soon then that is a fallacy based on the current data.

Oh and the only two prices that are relevant in any trade are the buy and sell price. Peeps need to remember that with houses as well as currency etc. Any notional value at any other time is just that....
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Old May 25th 2011, 1:54 am
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Default Re: The good old british quid

Originally Posted by Genesis View Post
It is a roller coaster. Up and down. If the pound is on a downward trend it will literally be utterly, utterly worthless in a matter of years if you take your 'trend' idea to its enth degree. That is not going to happen. A while back the pound was worth a huge amount. Back in the early 2000s it was almost 4 for a pound. Not doubt you would have called that a trend. But it wasn't was it? Just the simple machinations of forex. Action, reaction.
Oh, forgot this one. A spot value is just that, not a trend. 4:1 in 2000? well 2:1 now does give you a trend, which kind of proves my point, yes ups and downs but over time the downs have outweighed the ups....so the risk over time is to the downside....
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Old May 25th 2011, 2:30 am
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Default Re: The good old british quid

Originally Posted by simonsi View Post
Oh, forgot this one. A spot value is just that, not a trend. 4:1 in 2000? well 2:1 now does give you a trend, which kind of proves my point, yes ups and downs but over time the downs have outweighed the ups....so the risk over time is to the downside....
No it doesn't.
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