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Where did the US Dollar bears go??


JEast
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I assume you board members are still out there, just have not heard from you in awhile.  I agree with most of you that the US dollar is not on strong footing but I still do not know what a bad US dollar should be compared with.  The typical response used to be anything was better and especially Gold, but if commodities have now turned over – is the $ now the strongest of a bad lot?

 

Cheers

JEast

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I assume you board members are still out there, just have not heard from you in awhile.  I agree with most of you that the US dollar is not on strong footing but I still do not know what a bad US dollar should be compared with.  The typical response used to be anything was better and especially Gold, but if commodities have now turned over – is the $ now the strongest of a bad lot?

 

Cheers

JEast

 

What is happening to Gold is clear enough evidence to me that it doesn’t behave like a currency. And among currencies not only the USD is the strongest of a bad lot, it actually remains the only game in town. So, if you believe in holding some cash as a strategic asset, to be used opportunistically when a compelling investment finally presents itself, then hold US dollars.

 

giofranchi

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Here is Goldman Sachs' predicting the Australian dollar can fall to 80 cents versus the US Dollar.

 

Purchasing Power Parity would put it in the 60-70 cent range.  An overshoot, as these things typically do, would put it into the 40-50 cent range.

 

http://fx.sauder.ubc.ca/PPP.html

 

It has been a wonderful period to invest funds overseas as the margin of safety has been the AUD.  Alas, most Australian's have been sinking the proceeds of a multi-generational terms of trade boom into residential property. As the AUD drops and inflation picks up,  no doubt house prices may well track sideways for 10 years.  The punters will conclude property never goes down.  They will be correct except for the fact that their purchasing power has been halved.

 

cheers

 

nwoodman

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Here is Goldman Sachs' predicting the Australian dollar can fall to 80 cents versus the US Dollar.

 

Purchasing Power Parity would put it in the 60-70 cent range.  An overshoot, as these things typically do, would put it into the 40-50 cent range.

 

http://fx.sauder.ubc.ca/PPP.html

 

It has been a wonderful period to invest funds overseas as the margin of safety has been the AUD.  Alas, most Australian's have been sinking the proceeds of a multi-generational terms of trade boom into residential property. As the AUD drops and inflation picks up,  no doubt house prices may well track sideways for 10 years.  The punters will conclude property never goes down.  They will be correct except for the fact that their purchasing power has been halved.

 

cheers

 

nwoodman

 

There is a market in the Sydney Northern Beaches region that is already down 30% or so -- the area is small, from the homes overlooking Whale Beach to Palm Beach.  Not sure if that's the only place in Australia getting socked like that, but it's been interesting to watch the prices come down.

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Eric,

 

That is where you should move - Palm and Whale Beach are awesome!!

 

I was going there 1 month a year with my wife and kids after the big break in 2006 with the FFH options -- we would stay at my grandmother's cottage on Bynya Rd up above Whale Beach.  That's where I was during the October 2008 crash.  Then my grandmother died two years ago in April, less than a month after our last stay.  My father passed on his option to buy the place, sold his share to his siblings, and his siblings tore it down foolishly believing the land (two parcels) would be worth more marketed separately.  It's sad -- that cottage was build by my father (when he was 16) and my grandfather who bought the land in 1950.  Now his siblings are stuck with two parcels of land that they can't sell and it's market value has dropped 20% in 24 months.  We're just pulling for a lower AUD so we can buy the next family getaway -- I always wanted an ocean view anyway, that cottage had a Pittwater view.  But yeah, Whale Beach and Palm Beach are awesome -- I remember learning for the first time my right from my left based on which way we walked from the cottage down to Whale Beach.

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Nice!  We had relatives up on the plateau that then moved to Whale Beach.  So I agree with both of you, it is a cracking part of the world.  I hooked the biggest flathead of my fishing career in Pittwater :) Spent a wonderful Christmas eating and drinking and enjoying the view out to Whale Beach prior to my first Sydney to Hobart. Happy Days! If that is the plan Eric, it is a good one and richly deserved.

 

cheers

nwoodman

 

 

 

 

 

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Nice!  We had relatives up on the plateau that then moved to Whale Beach.  So I agree with both of you, it is a cracking part of the world.  I hooked the biggest flathead of my fishing career in Pittwater :) Spent a wonderful Christmas eating and drinking and enjoying the view out to Whale Beach prior to my first Sydney to Hobart. Happy Days! If that is the plan Eric, it is a good one and richly deserved.

 

cheers

nwoodman

 

I never fished Pittwater as a child but once on a visit in July around 1985 I caught a very large squid fishing into the rocks right off of the saltwater pool at Palm Beach.  We didn't really know what to do with the squid because we were experienced only with catching fish.  We were standing at the northeast corner of the pool when we brought it in.  It suctioned itself to the cement wall and we had to cut the line.  Then it crawled into the pool and swam off!  I wonder how long that squid survived in the pool undiscovered.  There is probably a local resident there wondering what hooligan did that.

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