A Strong Reason for Strong Dollars

by | Aug 7, 2001 | Archives

In recent months many messages at this site have suggested that US dollars are not especially strong, but rather the Euro and Yen especially weak. This gives concern to the whole currency system. Yet we discovered one temporary dollar prop at our recent Inspired Investing course.

Last month's Inspired Investing course featured BorrowLow Deposit High tactics where investors borrow one currency at a low rateand invest the loan in another currency that earns higher yields. Thecurrency exchange risk means that we studied the various currenciescritically. Teddy Christiansen pointed out that all European currencies(within the European Monetary Union) must be officially converted to eurosby July 2002. Officially converted means the conversion must report thesource of funds.

Every European who has a little money under the mattress (imagine how muchmoney this is when you consider the Italian, Spanish, Greek and Portugueseblack economies) must find some other way to get money out of local cashbefore this time. Many are buying real estate. Many others are investingin U.S. dollars to hold until after July 2002 when they can thenunofficially convert the dollars back to euros.

We cannot even guess how much inflow this brings to the greenback, but thisdoes suggest that wise investors might consider speculating in euros versusthe U.S. buck in about one year!

Our next course Friday, Saturday, Sunday, August 24-26 InternationalBusiness Made EZ is about how to make money in the best way possible, withyour own business. We have just a few spaces left. More details are below.

Until next message,

Good global investing!