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

To: energyplay who wrote (10322)	10/20/2006 2:18:05 PM
From: Riskmgmt	Read Replies (1) \| Respond to of 218000

Hello EP i agree on some of what you say. The US Dollar has been overvalued for a long time. Yes, in relation to some currencies, not all, IMHO. The high dollar has meant the export of US jobs & business activity to other developed nations, like Japan, Korea and some parts of the EU, like Ireland. Perhaps, still true in the case of Japan and Korea. Ireland is a special case of tax advantages, there are no cheap labor costs there and housing is very expensive also. I know many asians, including Japanese, see the US Dollar differently than we do. Many that I've talked with, regard the USD more as we used to the swiss Franc. Certainly, the Japanese like our T-Bills and T-Bonds with the 5% yield better than the 0-1/4% they get in yen. As far as Detroit selling cars goes, I think it is a Detroit problem rather than a gas price problem, unlike the Japs, they have always focused on domestic rather than export markets. We all saw the huge market demand for small efficient cars 40+ years ago when VW bugs were selling like crazy. It wasn't that we had expensive gas in the 60's it was just a demand for small efficient cars. Today 40 years later Detroit still doesn't make a reliable, efficient car and so exports fill that need. An excessively low US Dollar would mean the retention and expansion of lower value jobs and sales of assets at low prices. Remember when the Japanese bought Pebble Beach and par tof Rockerfeller Center ? A lower than normal USD would also make it harder for US companines to invest abroad. i think we have a low dollar now. Maybe, not to Yen but to Euro and GBP and other European currencies. Try spending a few weeks in London or Rome and you will long for the relatively dollar stretching N.Y. or L.A. I have traveled "the pond" for many years and this is the lowest dollar/GBP I have EVER seen. The Brits and Europeans are already buying assets in the USA as it is like a sale for them. Also, I don't see how selling our American assets with cheap devalued dollars is good for america or Americans. But lastly, and this, to me is, the point, it really doesn't matter what "we" think. It is a Global economy and the currency rates are reflecting on a daily bases the collective Global valuations. As is gold, oil, real estate, etc. All we can do as investors is buy where we perceive undervalue and sell where we perceive overvalue. You have done well in Energy an area that you know well. I have done well in Real Estate and currencies. I am waiting for your lead back into natural gas BTW.