Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: elmatador who wrote (8068)	8/7/2006 1:03:12 PM
From: Moominoid	Respond to of 220165

Generally European currencies are overvalued relative to the USD and most developing economy currencies undervalued when thinking about PPP - i.e. what the money buys in that country. Japan used to be overvalued but the Economist claims it is undervalued now. Hard to believe, but I haven't been to Japan. A much more comprehensive project originated at U. Penn called the "Penn World Table". The UN and World Bank also update these numbers now. But this under or over-valuation is different to a currency being under or over-valued in the foreign currency market. China's currency is undervalued by both measures - a dollar buys much much more in China than in the US and if the Yuan went into free float it would rise against the USD. But even when it got to equilibrium most commentators seem to think stuff in China would still be cheap. Which is the norm for a developing economy.