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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (19457)	12/23/2004 3:43:37 PM
From: patron_anejo_por_favor	Read Replies (1) \| Respond to of 116555

Definitely agree with Rodger on this point: The dollar is overvalued because of Asian intervention and becoming more overvalued with every month of continuing trade deficits. Period. It's important to stress that Asian intervention doesn't just mean the usual BOJ efforts at propping up the dollar...the pegged Yuan is an ongoing intervention that goes on day and night until the Chinese cut it loose. And it has the same effect, of propping up the dollar. Another way to look at it is that the dollar is "pegged" to the Yuan, since the Chinese economy is performing better than the US....when that peg is cut, look out beeeloooooowwwwww...... ...or as Soundgarden (and Johnny Cash) said: You wired me awake And hit me with a hand of broken nails You tied my lead and pulled my chain To watch my blood begin to boil But I'm gonna break I'm gonna break my I'm gonna break my rusty cage and run Too cold to start a fire I'm burning diesel burning dinosaur bones I'll take the river down to still water And ride a pack of dogs I'm gonna break I'm gonna break my I'm gonna break my rusty cage and run Hits like a Phillips head Into my brain It's gonna be too dark To sleep again Cutting my teeth on bars And rusty chains, I'm gonna break my Rusty cage and run When the forest burns Along the road Like God's eyes In my headlights When the dogs are looking For their bones And it's raining icepicks On your steel shore I'm gonna break I'm gonna break my I'm gonna break my rusty cage and run

To: mishedlo who wrote (19457)	12/23/2004 4:27:19 PM
From: RealMuLan	Read Replies (2) \| Respond to of 116555

Here is the replication of iPod example on Chinese Yuan 1 Yuan = $0.12 iPod = $299 iPod = 3,999 Yuan Based on iPods, One Yuan should be worth 7.5 US cents and appeared to be about 61.5% overvalued!<g> But interesting though, how Apple rips off the Chinese customers: for European customers: 1.34Euro * $299= 400.66 Euro, but sold for only 349 Euro; for Chinese customers: 8.28 Yuan * $299 = 2,475.72 Yuan, but sold for as much as 3,999 Yuan, 62% of premium of the exchange rate! Yes, a small part due to China's tariff, but still this does not make sense. And Apple is not the only company doing this, hundreds of companies doing this to Chinese customers. Edit, and this will make this price looks even more ridiculous since a lot of iPod is made by using Chinese cheap labors! "Apple is the worst offender in the decline of U.S. manufacturing. Their engineers sit around in air-conditioned offices on streets with cutesy names like Infinite Loop in Cupertino, Calif., and have others make stuff for them. They imported two million iPods assembled by thousands of Chinese workers just last quarter -- an almost $1.5 billion annualized trade deficit in iPods alone." Message 20884982