CURRENCY “FLURRIES”
Being a Meteorologist by military training, and being a Director of CEIFX.COM, a currency exchange corporation, I like the concept of FLURRIES.
The word FLURRY evolved in 17th Century English as a combination of the words: FLUTTER and HURRY. If you have ever seen a bird flutter its wings, trying to escape a predator, or a young man or a young woman, trying to get somewhere before it is too late, and in a terrible Hurry, you can understand the concept of a Flurry.
Definition: Move in an agitated or confused way. In weather it is a sudden outburst of rain associated with fast gusts of wind, all of which comes and goes in minutes.
In the Foreign Currency Market, it is sudden rises or falls of currencies; changing direction within days or weeks, and making Traders accumulate gray hair as they try to figure out which currency to buy or sell. Recently, the Foreign Currency Market around the world has shown Flurries of activity as politicians pass new laws and economies crumble or recover, while Stock Markets behave like Yo-Yo’s.
THE EURO
No longer than one month ago, the Euro, relative to the U.S. Dollar was bouncing around $1.20. Today, it ended above $1.30.
The PIIGS suddenly seemed stronger to the investing moguls of the world, and their bonds are being bought at reasonable prices.
U.S. DOLLAR
Lo and behold, the Messiah from Africa and Indonesia, is losing his charm. American Consumer Confidence is dropping sharply and the Double Dip is looking more like a certainty than two scoops of ice-cream.
YEN
Japan is showing a strong deflationary trend. The Japanese Government owes its citizens two trillion dollars worth of Yen.
Japan is a major world exporter. If prices go down in Japan, importers around the world will want its currency. The Yen closed on Friday at $86.62, a price not seen in over six months.
THE “LOONIE” CANADIAN DOLLAR
The Loonie is pushing upwards as the U.S. Dollar reverses and heads in the opposite direction. The Loonie is very close to $.95. The Canadian currency in the last two years had been above par with the U.S. currency and it may go there again.
THE “AUSSIE” AUSTRALIAN DOLLAR
The trend of the Aussie follows the trend of the Loonie. Why?
Because both the “Aussie” and the “Loonie” are agricultural countries with the added benefit of huge resources of commodities.
China, the strongest economy on this particular Planet, needs those resources. It will pay whatever the market charges so that its population is fed and its factories keep humming as they turn commods into household and industrial products.
YUAN
It doesn’t take more than a half an ounce of brains to deduce that the CHINESE YUAN will cost exactly what the Chinese Government Specialists want it to cost.
The Chinese Currency Specialists have a tough job. They must calculate their expected exports, expected imports, cost of goods, cost of labor, which currency is going where, and then– manipulate the YUAN accordingly! By the way, if a Governmental Specialist makes a deafening error — read my article on CHINESE EXECUTIONS.
Working for the Chinese Government is well paid and secure — but, don’t get anyone of importance angry with your decisions.
GOLD
If the entire world goes into a Deflationary Phase, the price of Gold will drop. But, a Deflationary Phase will cause the eruption of political uprising, wherever the police powers of the governments are weak.
The Police Powers of Europe and the U.S. are relatively weak at the moment. We have seen the Greeks, Spaniards and French marching through the streets. In the U.S., there is a small coalescence of private individuals who detest Big Socialist Governments. They are called: THE TEA PARTY.
Their future is unknown. But, in Germany in the 1920′s and 1930′s a small group like this rose to power and took Germany into a series of wars culminating in WWII.
There is no worry about this happening in the USA. Germany at that moment in history was a solid group of blond headed people with one language and one set of core values.
The USA today, is just the opposite. The demographic mixture in the U.S. could not be more diverse. Its languages and value system is a basket of tattered ideas from all over the world.
However, the possibility that the U.S. Federal Government takes advantage of the social chaos present in the U.S. in 2010 is a different story. It seems as though this is exactly what the small group that controls the U.S. wants.
SUMMARY
Predicting Foreign Currency rates during FLURRIES of foreign currency trading is like predicting the weather on a small island near the North Pole where pressures and winds are constantly swirling.
It can be a lot of fun and some people make big profits. But those that win, generally have a private telephone line to an office in the clouds.
