Dear Readers,
It seems that our worries about the drop in the value of the dollar are not only felt by us, but by the financial community at large. The Federal Reserve Chairman Ben Bernanke has stood by and defended his monetary stimulus, and even went so far as to implicitly accuse China that they are not doing enough to strengthen their own currency. Adding to that the fact that the Euro has strengthened for the third day in a row and that the rising commodity prices have boosted consumer price inflation in China, the financial community fears that the dollar "will become the world's 'weakest currency'". Now, whether this will be a good thing for shipping, or not, is yet to be seen by the strategies that the shipping companies will decide to enforce.
Read our original article: Shipping Markets: Quantitative Easing Round 2 - $600 billion
Best Regards,
Theo Scholiadis - S&P Broker
Main articles used (list not exhaustive):
- Dollar to Become World's 'Weakest Currency,' Drop to 75 Yen, JP Morgan Says
[Source: Hellenic Shipping News Worldwide] [Date: 18/11/2010]
- Bernanke Defends Fed' Policy, Turns Tables on China
[Source: Bloomberg Businessweek] [Date: 19/11/2010]
- Euro Gains for Third Day; Asian Stocks, Metals Pare Weekly Drop
[Source: Bloomberg Businessweek] [Date: 19/11/2010]
Thanks for your always informative blog!
ReplyDeleteThe USD is being deliberately devalued, as we all realise,but the Chinese currency is pegged to the dollar, so it's value falls too.....thus, it helps keep Chinese goods competitive...this hurts other developing or export based economies, like India ( as developing) and Germany ( an export oriented economy) because it makes their good/services more expensive.
Thanks!
Bernard W Rees
I've been looking everywhere for this fix! Thanks!
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