Two Multi Currency Forces


In today’s study we can see two multi currency forces confirmed in the press.

Recent lessons have suggested it is wise to do nothing with equities and
to diversify out of the US dollar into:

Danish, Swedish and Norwegian kroner
Canadian dollars
British pounds and gold.

Another New York Times confirms the advice of holding on to your existing equities (assuming they are good value equities and your overall financial position allows this).

The article said:

Dow Soars 379 Points as Investors Find Faint Signs of Hope

Wall Street soared on Tuesday in its biggest rally of the
year after investors found a glimmer of optimism in the
financial sector. The Dow Jones industrial average closed up
379.44 points, or 5.8 percent, at 6,926.49, while the
Standard & Poor’s 500-stock index was up 6.4 percent and the
Nasdaq composite index rose 7.1 percent. The factors fueling
the rally included a memorandum from Citigroup saying that
the bank had been profitable in the first two months of the
year; calls for regulatory reforms from the Federal Reserve
chairman, and the possibility that the government would
reinstate rules governing short sales of stocks.

This article was about a sudden three day rally on Wall Street. This type of sudden rally suggests that the bottom of the correction is near.

Yesterday’s lesson  “Do Nothing Again” explains why it is so important to be holding equities now to catch the recovery spurt.

This recent three day rally also suggests that equities may now offer better value now so adding equities denominated in  Danish, Swedish and Norwegian kroner
Canadian dollars and British pounds may be especially attractive.

Taking advantage of this value to diversify out of the strong US dollar also makes sense. This idea is fortified by  today’s New York Time’s article entitled  “China’s Leader Says He Is ‘Worried’ Over U.S. Treasuries”

The March 13 article by Michael Wines, Keith Bradsher and Mark Landler says:

The Chinese prime minister, Wen Jiabao, spoke in unusually blunt terms on Friday about the “safety” of China’s $1 trillion investment in American government debt, the world’s largest such holding, and urged the Obama administration to offer assurances that the securities would maintain their value.

Speaking ahead of a meeting of finance ministers and bankers this weekend near London to lay the groundwork for next month’s Group of 20 summit meeting of the nations with the 20 largest economies, Mr. Wen said that he was “worried” about China’s holdings of United States Treasury bonds and other debt, and that China was watching economic developments in the United States closely.

As the financial crisis has unfolded, China has become increasingly vocal about what it perceives as Washington’s mismanagement of the global economy and financial system, joining a chorus of foreign critics of unbridled American capitalism. On Thursday, for example, France and Germany rebuffed American calls to coordinate a global stimulus package at the G-20 meeting, saying financial regulation should come first.

This type of article could cause a run on the greenback.

The instability in world currencies also means that we should take a long term view when adding equities to our portfolios now.  Equities may offer good value now, but fear and turmoil could stop sudden recoveries quickly and cold. Beware of up and down motion in markets now.

Gary

This is an extra good time to subscribe to Ecuador Living because Jyske Global Asset Management is conducting a multi currency seminar in Naples Florida May 29-31.  The fee to attend is $499 ($750 for two) but Ecuador Living subscribers can attend free.

Learn more about the seminar here.

You can enroll free for that seminar here.

Future 2009 courses

May 29-31  JGAM Florida Investment Course

June 12-14 Shamanic Mingo Tour
June 16-17 Imbabura Real Estate Tour
June 18-21 Ecuador Coastal Real Estate Tour

In the shamanic mingo you will learn how the concept of fractals is
part of the ancient sacred geometry that leads us to where we should
be. The shamans belive that the mountain we grow up viewing is our
mother (Pacha Mama) who guides us on our life’s way.

This never made much sense to me until visiting our daughter, son in law, grandkids and my 86 year old mother.

Each day I walked out my mom’s front door (she has lived in the same house for 50 years) and enjoyed the view where I grew up.

Mt-cotacachi

Mt. Hood…Pancha Mama. Something was gnawing at me…where had she led me? I missed the connection.

Mt-cotacachi

The equivalent geometry at Mt, Cotacachi that I now see each day from my Cotacachi front door.

This did not hit me until we took mom to our favorite beach…our
historical escape on Oregon’s coast. This shot as I looked down the
beach made me think about this more.

Mt-cotacachi

Because the geometry is so like our beach escape in San Clemente, Ecuador.

Cotacachi fractals

July 3-6 Ecuador Import Export Expedition
July 8-9 Imbabura Real Estate Tour
July 10-13 Ecuador Coastal Real Estate Tour

July 24-26 IBEZ North Carolina

Sept. 17-21 Ecuador Spanish Course
Sept. 23-24 Imbabura Real Estate Tour
Sept. 25-28 Ecuador Coastal Real Estate Tour

Oct. 9-11 IBEZ North Carolina

Oct. 21-24 Ecuador Import Export Expedition

Nov. 6-8 IBEZ Ecuador
Nov. 9-10 Imbabura Real Estate Tour

Attend any two Ecuador courses or tours in a calendar month…$949 for one.  $1,349 for two.

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