Tag: dollar

Watch out for the currency traps

Tuesday, 2 December, 2014 1 Comment

“We cannot go on with this euro. We must improve the European monetary policy and achieve equality of the dollar and euro interchange,” said former Italian Prime Minister Silvio Berlusconi at the Forza Italia party’s ‘No Tax Day’ rally in Milan on Saturday. “We must bring back our right to print money and establish monetary market exchange.”

Meanwhile, Tehran’s economy minister, Ali Tayyebnia, warned yesterday against “frenzied behavior” as Iranians dumped their rials. And in Venezuela, the dollar is now worth 1,700 percent more on the black market than the price the government charges those lucky enough to obtain it legally. Then, there’s the collapse of the ruble. This entire currency business is treacherous so it’s not surprising that when the Financial Times listed its Best books of 2014 at the weekend, the “trap” metaphor appeared prominently in the top titles reviewed.

Traps


The easing and ending of the Zimbabwe dollar

Friday, 14 September, 2012

When Zimbabwe achieved independence from Britain in April 1980, its revolutionary rulers decided to replace the Rhodesian dollar with the new Zimbabwe dollar (ZWD) at par and it was valued at US$1.54. But tyranny and turmoil soon replaced law and order as the “comrades” warmed to statism and inflation inevitably followed. By 2007, the ruin […]

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The real Gisele Bündchen is so fickle

Monday, 26 March, 2012

Back in 2007, the world’s top-earning model, Gisele Bündchen, reportedly responded to the falling value of the US dollar by refusing to be paid in the currency of Uncle Sam. Her sister and manager told the Bloomberg news agency that Gisele preferred to be paid in euros. Five years ago, the euro was seen as […]

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Punk Economics

Tuesday, 31 January, 2012

Irish economist, David McWilliams, explains the euro crisis using “punk economics“, which he describes as “a new way looking at the economy based on the central idea that what is important is not complicated and what is complicated is never important.”

Snippet: “The German solution will only cause a recession, or more recessions, in the periphery. This will cause money to flow into Germany, not out of Germany, because the risk of default in the periphery increases and in time much of Europe will begin to look like Greece, teetering on the edge. As money flows into Germany, German bond yields fall, Greece will default, and this will give the others permission to do likewise because a default in Greece sets off a domino effect all over Europe because Europeans will say, ‘Well, if the Greeks can do it, why can’t we?’ Is it any wonder right now that the price of gold is firm, that the yield on German bonds is falling and that the euro is weakening against the dollar?” He’s onto something.