- Stock markets all over the world tank at the same time. Up at the same time. Last time we talk about Yen carry trade, today, it is US Dollar carry trade, which I believe is many times bigger than its brother Yen.
- Foreign currency exchange about USD4 trillion a day. World GDP is only about USD60 trillion. Foreign currency is a very very huge CASINO. Imagine, any investor/players, with minimum of USD300.00 can put their hands on currency speculation. It became a full time game for many.
- Hence, we must really watch out for the currency war. It is very very VOLATILE. There is no economic benefit in trading in forex, similar to guessing head or tail in a flipping of coin game. It is so huge that no single person on earth can INFLUENCE it unlike stock markets.
- Would it be the reason why when USD up, commodities, stocks, other asset class DOWN. It is like a see-saw, when USD is DOWN (currently), there rest of the asset class is UP. Is it a turning point now? Perhaps.
MyView
Investing in whatever class of assets is actually a probability game, valuation is relative, and there is no tools in the world can tell you exactly where any prices will goes up or down. Hence, valuation is simply depends on the eyes of the beholder. Price is what you pay, value is what you get. (Mr Buffett said). By the way, Buffett had been selling lots of shares lately. I wonder why?
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