Jcollins
SEPTEMBER 2, 2015 AT 2:23 AM
I would hold mostly currency of emerging economies, especially those with trade surpluses and big foreign exchange reserves. A little gold. More silver. And a constant stream of incoming knowledge from multiple sources. The ability to remain nimble and make quick decisions will be instrumental. In addition, modernization and infrastructure development in the emerging economies will push commodities up again. It’s cyclical. Just may take a year or two more.
SEPTEMBER 2, 2015 AT 3:22 AM
Many thanks for your prompt reply, JC. Much appreciated. Your thoughts are very similar to mine. Incoming information is the least of our problems these days! When you refer to “currency of emerging economies,” do you mean bank deposits and/or money market funds in those currencies and, if so, what would your assessment be of the risk posed by bank insolvencies/resolutions/bail-ins during the process of transition to the new Multilateral Financial System, please? I recall this article making a big impression on me:
http://www.telegraph.co.uk/finance/personalfinance/investing/11686199/Its-time-to-hold-physical-cash-says-one-of-Britains-most-senior-fund-managers.html
In that context the idea of abolishing cash and making currency 100% digital sounds like a bad one to me.
Thanks again!
REPLY
Jcollins
SEPTEMBER 2, 2015 AT 12:29 PM
I agree. And yes, my approach is that if you can’t hold it in your hand than it isn’t yours. As such, cash in hand is golden.
SEPTEMBER 2, 2015 AT 3:41 AM
JC – Another well written and informative post.
One thing, you mention alternative “Safe Havens” to the USD, being the euro and Yuan.
Given what we are currently seeing in both those jurisdictions (Euro – with many of the member nations being technically bankrupt, China which is experiencing multiple bubbles e.g. property and equities) I am interested in why you believe either of them would be safe havens.
Cheers
REPLY
Jcollins
SEPTEMBER 2, 2015 AT 12:32 PM
Not all euro zone countries have debt issues, and the US equity markets have dropped more than China’s since the beginning of the year. Don’t believe all the hype you hear or read. The euro and yuan are slowly accumulating more and more in the foreign exchange reserve accounts. This will increase in the coming months and years. This is what will build further confidence in both currencies as safe havens in a time of crisis. Along with the USD, this will provide investors with three safe havens.
SEPTEMBER 2, 2015 AT 4:59 AM
Off the cuff question JC…the other day I was thinking about when the USD became the reserve currency and how the Bancor was dismissed at Bretton Woods (reason unknown, maybe just wasn’t it’s time as the prototype needed to be tested, i.e. USD?, then a second Beta Test, the SDR?) Does this make any sense or am I waaaay off the mark?
I mean, if one wants to assure as best they can that something will succeed it needs to be tested and tweaked as it goes along.
REPLY
Jcollins
SEPTEMBER 2, 2015 AT 12:35 PM
That could be the case. You are right, there is a lack on information on this matter. I know you have been researching into this, as have I. Something tells me that to understand why the dollar was chosen over the bancor back in 1944 will tell us a lot about what is going to happen in the coming years. I keep coming back to it. Let’s stay on it.
SEPTEMBER 2, 2015 AT 2:23 AM
I would hold mostly currency of emerging economies, especially those with trade surpluses and big foreign exchange reserves. A little gold. More silver. And a constant stream of incoming knowledge from multiple sources. The ability to remain nimble and make quick decisions will be instrumental. In addition, modernization and infrastructure development in the emerging economies will push commodities up again. It’s cyclical. Just may take a year or two more.
SEPTEMBER 2, 2015 AT 3:22 AM
Many thanks for your prompt reply, JC. Much appreciated. Your thoughts are very similar to mine. Incoming information is the least of our problems these days! When you refer to “currency of emerging economies,” do you mean bank deposits and/or money market funds in those currencies and, if so, what would your assessment be of the risk posed by bank insolvencies/resolutions/bail-ins during the process of transition to the new Multilateral Financial System, please? I recall this article making a big impression on me:
http://www.telegraph.co.uk/finance/personalfinance/investing/11686199/Its-time-to-hold-physical-cash-says-one-of-Britains-most-senior-fund-managers.html
In that context the idea of abolishing cash and making currency 100% digital sounds like a bad one to me.
Thanks again!
REPLY
Jcollins
SEPTEMBER 2, 2015 AT 12:29 PM
I agree. And yes, my approach is that if you can’t hold it in your hand than it isn’t yours. As such, cash in hand is golden.
SEPTEMBER 2, 2015 AT 3:41 AM
JC – Another well written and informative post.
One thing, you mention alternative “Safe Havens” to the USD, being the euro and Yuan.
Given what we are currently seeing in both those jurisdictions (Euro – with many of the member nations being technically bankrupt, China which is experiencing multiple bubbles e.g. property and equities) I am interested in why you believe either of them would be safe havens.
Cheers
REPLY
Jcollins
SEPTEMBER 2, 2015 AT 12:32 PM
Not all euro zone countries have debt issues, and the US equity markets have dropped more than China’s since the beginning of the year. Don’t believe all the hype you hear or read. The euro and yuan are slowly accumulating more and more in the foreign exchange reserve accounts. This will increase in the coming months and years. This is what will build further confidence in both currencies as safe havens in a time of crisis. Along with the USD, this will provide investors with three safe havens.
SEPTEMBER 2, 2015 AT 4:59 AM
Off the cuff question JC…the other day I was thinking about when the USD became the reserve currency and how the Bancor was dismissed at Bretton Woods (reason unknown, maybe just wasn’t it’s time as the prototype needed to be tested, i.e. USD?, then a second Beta Test, the SDR?) Does this make any sense or am I waaaay off the mark?
I mean, if one wants to assure as best they can that something will succeed it needs to be tested and tweaked as it goes along.
REPLY
Jcollins
SEPTEMBER 2, 2015 AT 12:35 PM
That could be the case. You are right, there is a lack on information on this matter. I know you have been researching into this, as have I. Something tells me that to understand why the dollar was chosen over the bancor back in 1944 will tell us a lot about what is going to happen in the coming years. I keep coming back to it. Let’s stay on it.
