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Floradude

Peso/Dollar

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It is a pretty good time to buy pesos.

The dollar is trading somewhere around 13.4 pesos/1 USD depending on which bank you use.

Maybe time to visit your favorite ATM.

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my Euro is.

Emerging markets like Mexico are having a hard time.... Brazil,... Argentina devaluated yesterday by 11 %.

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Emerging markets??

An emerging market is a country that has some characteristics of a developed market but is not a developed market. This includes countries that may be developed markets in the future or were in the past.[1] It may be a nation with social or business activity in the process of rapid growth and industrialization. The economies of China (excluding Hong Kong and Macau, as both are developed) and India are considered to be the largest.[2] According to The Economist, many people find the term outdated, but no new term has yet to gain much traction.[3] Emerging market hedge fund capital reached a record new level in the first quarter of 2011 of $121 billion.[4] The eight largest emerging and developing economies by either nominal or inflation-adjusted GDP are the BRIC countries (Brazil, Russia, India and China), as well as MIKT (Mexico, Indonesia, South-Korea and Turkey).

The ASEAN–China Free Trade Area, launched on January 1, 2010, is the largest regional emerging market in the world.[

source : Wikipedia

And this from US Reuters today :

(Reuters) - A full-scale flight from emerging markets accelerated on Friday, as investors sold shares in major markets and bought safe-haven assets such as U.S. Treasuries, the yen and gold.

On Wall Street, the benchmark S&P 500 stock index tumbled 2.0 percent on the day, and ended the week down 2.6 percent, its worst week since June 2012.

Concerns about slower growth in China, reduced support from U.S. monetary policy and political problems in Turkey, Argentina and Ukraine drove the selling.

The Turkish lira hit a record low as the cost of insuring against a Turkish default rose to an 18-month high. Argentina's peso fell again after the country's central bank abandoned its support of the currency.

The declines mirror moves from last June when developing country stocks fell almost 18 percent over about two months and hit global shares after the Federal Reserve indicated it would soon reduce its bond-buying.

"The world is suffering from the emerging markets' flu," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.

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The rise in the US dollar rate appears linked to the recently SUBmerging US stock market.

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Not if you look at the last few days; the US market was going up and the Peso was going down. Today the market went down and the Peso went further down. They don't correlate at all.

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I guess Canada is an "emerging" market too!!

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If the peso weakness is due to concerns over Argentina and Brazil unjustifiably spilling-over onto Mexico, as some nervous traders retreat to the perceived "strength" of the US dollar, maybe just wait.

Where the US central bank has no real reserves to prop up the US Dollar, Mexico does have reserves. The USA's public debt is projected to hit $23 trillion soon, the Chinese have cut their US debt ownership from 2012 $2.3 trillion down to $1.3 trillion late last year, because they see future US dollar weakness. The US public continues to be the major purchaser of their own debt as the US Treasury dept. continues to print $100's billions of crisp new paper dollars a month. (US debt is growing at roughly $750 billion a month.)

It's like a grease factory, that takes the grease it produces and uses most of it to lube the factory's machinery.

The proposed rush to the security of gold is not reflected in gold prices:

http://www.google.com.mx/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&docid=GAJ0kdRtnP0lAM&tbnid=Pk8r3g9J5Pf_LM:&ved=0CAUQjRw&url=http%3A%2F%2Fwww.marketoracle.co.uk%2FArticle43919.html&ei=ZNTjUvvlGMfKkQeqooHICw&bvm=bv.59930103,d.eW0&psig=AFQjCNGYEkjgp9vYIoJvMEXU12RdEDOjmQ&ust=1390749081020106

The debt picture across the USA is ugly: US student debt topped $1 trillion last quarter, US people's and government's total non-financial debt hit 245% of GDP in 2014 ( $55 trillion). Since the US government owes 114% of the total US GDP, the rush of ebullient US dollar buying may not last long, especially if the Mexican central bank takes strong action - since Mexico's central bank actually has reserves, unlike the US Fed that continues to buy $85 billion of "stimulus" bonds from the US Treasury department, as Treasury prints trillions of fresh newly printed paper dollars with nothing to back them (except "the full faith and credit of the US Government"). How much faith do any of us have in Congress's ability for restraint?

Remember that currency traders are the fickle 13 year old girls of the investment world. All it takes is one bit of bad news about the USA to cause the tide of ebullience to retreat.

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Everything is a bubble now. Just a matter of time till it all pops. I think we are in a good place when it does.

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"Bad news" from the US? - remind me when we heard "good" news. The other day I saw the number of all the unemployed in modern industrialized countries is 200 million - well, guess what, 92 million of them are in the US.

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I see Jack Lew says he is out of bookkeeping tricks to keep the US government afloat. We will have another increase in the debt limit in February. Republicans will demand some cuts in spending. Democrats will cut some minor program and then increase spending elsewhere.

Let's see what comes out of the State of the Nation speech tomorrow. Lots of new programs funded by the printing press and attacks on the wealthy, Republicans and Christians. It's all their fault. Last year's speech was so vile and divisive that some of the Justices said they would not attend again.

The bubble is going to burst.

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Rufus,there are plenty of political forums out there where you can spout your nonsense,this isn't one of them.

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Rufus,there are plenty of political forums out there where you can spout your nonsense,this isn't one of them.

Didn't sound like nonsense but the truth, and we need to hear the truth not only for ourselves but for our countries, children and grandchildren.

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the wealthy, Republicans and Christians. It's all their fault.

Of course it's not all their fault,but they are the ones who's policies brought the country to the brink of financial collapse,not to mention the war in Iraq.

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Rufus...You may want to get your facts straight. One of the factors in the current market decline is the tightening of monetary policy by the Fed.

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War is the only engine that drives the economy, isnt it? It has never mattered which party was in power, just that the great Westward Expansion finally ran into the Pacific Ocean, then everything in between got used up. At that point, exploitation elsewhere was inevitable.....sadly.

Now, the rest of the world has pretty much caught up with post-WWII re-building and much of it is outpacing us economically, educationally and deciding that it no longer needs our support, our interference, or maybe even our business.

As the Brits might say, we are rapidly becoming redundant.

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The Fed cannot keep giving the treasury newly printed bills in exchange for bonds. We will end up with a hyper inflation. Mexico is a wonderful country, but it is not a good place to be poor when the value of your NOB pension and investments are reduced by inflation. No place is a good place to be poor.

The Teaparty people are of the opinion that the situation can be righted. I, on the other hand, think that we have gone too far and are in too deep. It is irreversable.

Now, what kind of person would I be if I slipped away in the lifeboat and left the rest to worry about a sinking ship?

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After a weekend to think about it, currency traders shifted from US Dollars to MXN pesos:

MXN Peso values strengthened today at $13:35 pesos per USD, down 1.4% versus last Friday's $13.54.

MXN Peso values strengthened today at $12.00 pesos versus the Canadian Loonie.

While the Peso and China's yuan (renminbi) got stronger today, the CAD Loonie continued its slide versus the USD, along with the sliding Argentinian peso and Brazil's sliding Real, and weaker Russian Ruble.

Does this mean that currency traders rested over the weekend, became circumspect, and realized that the Mexican economy and the Mexican central bank are not having the same problems as Russia, Brazil, Canada, and Argentina?

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We will have another increase in the debt limit in February. Let's see what comes out of the State of the Nation speech tomorrow.

The debt limit is meaningless. BTW, its the State of The Union address.

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