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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: thebeach who wrote (15169)11/30/1997 8:33:00 PM
From: marc chatman  Respond to of 50167
 
thebeach, in a word, currency risk (i.e., potential depreciation of the peso).

You could convert your dollars to pesos and get your 14% return on the peso money market, but if the peso depreciates against the dollar, you get back fewer dollars when you convert back. If the depreciation is significant enough, you could even have a net loss. I believe this happened a few years ago when Mexico had their most recent financial crisis.

By the way, I generally don't trade currencies, so I couldn't comment on the stability of the peso. If that is what you are looking for, maybe someone else could give you more help.



To: thebeach who wrote (15169)12/1/1997 5:15:00 AM
From: George Mc Geary  Read Replies (2) | Respond to of 50167
 
Beach, Since '79 or '80 (I think) they will not convert the Mexican Peso back into US$'s. In the '70 and there was a small gain to be had. But in early '80 there only way to make a gain was to spend your interest and principal in the local economy. After 1985 the risk of inflation or depreciation of the Peso has outweighed the gain. George


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