Value of USD

[JoeWras]

I click on this thread and think: "What is wrong with OP, this post doesn't make sense." Then I notice it is from 2009. Oh!

USD value is always a plus/minus, depending on your situation. As a US Citizen touring abroad, it is "whoo hoo" right now. But if I were an exporter, I might be crying.

I was reading about the yuan, and how this may affect production of Mercedes in the USA. A lot of US build Mercedes are exported to China. This may throw a wrench in the works.

 

[jetpack]

So when will the up trend turn around? Sell high.

 

[soupcxan]

Who dares bump this thread from six years ago!?

 

[eta2020]

Strong dollar makes investing in overseas markets attractive.....
Time to add to international exposure.

 

[NYEXPAT]

I just filed for SS last week and my payment ( in Dollars) will be worth 20% more (in local currency) than just 18 months ago. The probability of no COLA this year is ok as inflation (here) is running below 3%.

 

[marko]

I click on this thread and think: "What is wrong with OP, this post doesn't make sense." Then I notice it is from 2009. Oh!

I had the same reaction! "What are these people talking about?!"

Back to 2015, all this gives weight to the investing axiom: "Over time"

 

[tmm99]

Who dares bump this thread from six years ago!?

So sorry! I am the OP. I was browsing through my old threads and found this particular thread. I apologize if I confused some of you.

The value of USD going up is making a huge impact on my finance since I hold all my assets in USD while living in Canada. It's like the stock market went up by 30% and my assets are now worth much more (if I spend my money in Canada) but just like the stock market, we don't know how long it will last (Only 4 years ago, USD $1 was weaker than CAD $1).

I decided to bump this thread up because it is affecting everyone else who is holding USD's living in a foreign country (or frequent foreign countries), and I wanted to know what they thought about this huge change in the last several months.

 

[MichaelB]

I think it's fun to see old threads. What we thought would happen, what did happen. Not so much who got it, more like "why was I thinking that"?

 

[NW-Bound]

I love to see old threads. How time flew!

 

[Bestwifeever]

I think it's fun to see old threads. What we thought would happen, what did happen. Not so much who got it, more like "why was I thinking that"?

Ditto.

 

[Meadbh]

Ditto +1

I didn't know you could still bump a thread that old. Perhaps if you were the OP it is allowed.

 

[NW-Bound]

Anybody can bump an old thread, not just the OP.

Back on how many of us got it wrong, perhaps it should not be surprising. The market always has a way to confound the majority. Else, everybody would be rich, and we know that cannot happen (who would be left to work?).

And when the majority is right, we collectively bid up an asset so much there is little upside left. Even when you are right, the timing is still important. You've got to beat the crowd getting in first, then beat them out the door when things turn sour.

 

[Meadbh]

Anybody can bump an old thread, not just the OP.

That has not been my experience. I have had error messages like "this thread is more than 299 days old and you cannot post to it". And yes, I did once donate to FireCalc.

 

[eta2020]

Anybody can bump an old thread, not just the OP.

Back on how many of us got it wrong, perhaps it should not be surprising. The market always has a way to confound the majority. Else, everybody would be rich, and we know that cannot happen (who would be left to work?).

And when the majority is right, we collectively bid up an asset so much there is little upside left. Even when you are right, the timing is still important. You've got to beat the crowd getting in first, then beat them out the door when things turn sour.

Lot of people were advocating to buy Foreign equities and Commodities.

They should had loaded up on US equities which had lost decade behind it.

And right now we should probably load up on underperforming assets like Emerging Markets and Oil. (That means add to positions in those areas)

 

[MichaelB]

That has not been my experience. I have had error messages like "this thread is more than 299 days old and you cannot post to it". And yes, I did once donate to FireCalc.

At the bottom of the page on these old threads there is a dialog box titled "Old thread warning" and allows you to select "I am aware that this Thread is rather old but I still want to make a reply".

 

[NW-Bound]

... And right now we should probably load up on underperforming assets like Emerging Markets and Oil. (That means add to positions in those areas)

There's still a thing called a "value trap". You buy what you think is a bargain based on P/E or book value or whatever, then sit on it for years without making any money, or in the worst case even lose more or all of it. Even for stocks that we "know" cannot go to zero and will turn around some days, getting in too early and you will be underperforming the market. And that means a failed stock pick, no matter how you spin it.

 

[bclover]

I click on this thread and think: "What is wrong with OP, this post doesn't make sense." Then I notice it is from 2009. Oh!

USD value is always a plus/minus, depending on your situation. As a US Citizen touring abroad, it is "whoo hoo" right now. But if I were an exporter, I might be crying.

I was reading about the yuan, and how this may affect production of Mercedes in the USA. A lot of US build Mercedes are exported to China. This may throw a wrench in the works.

Lol got that right. I just got back from over seas. I was a very happy camper

Sent from my SPH-L710 using Early Retirement Forum mobile app

 

[audreyh1]

Value of USD has been in decline for years... Anything coming from the outside the country ends up costing more. Just as an example, USD was worth about 120 yen / dollar in 2004 and now it hovers around 95 yen / dollar. When I went to Canada in 2001, everything seemed really cheap, but now Canadians are traveling to US to shop. I guess it doesn't hurt you directly as much if you never have to wire/transfer money to other currencies or live/travel abroad, but I'm sure we will feel some impact at the home front too with all the trading we do with other countries.

What does it mean for us? Is this called inflation in a way? (not inside US but in world trade). How will it affect us in the near future?

What would raise the value of the dollar and what would be the side effect of it?

This is so confusing to me.

Take out your crystal ball and tell me

Well - the world changed, didn't it! !!!!!

 

[audreyh1]

I too believe the dollar will inexorably decline. As a consequence, I have a fairly large slug of foreign equity mutual funds and individual stocks in mostly non-US, commodity-related companies (especially commodities that are typically priced in dollars). I have also had a substantial amount in CD's denominated in Brazilian reais for the past 3 years. There was a bit of a blip during the depths of the recent financial panic, as investors fled to US treasuries, but the real has now resumed its long march up against the dollar, and I think it will continue.

How did that work out?

 

[audreyh1]

Who dares bump this thread from six years ago!?

USD has come a long way (the tables have turned since this thread was posted in 2009)... My USD has been doing so much better against CAD (I am in Canada now..)

I imagine some of you are happy that USD is stronger while some are unhappy... It feels kind I am riding some kind of roller coaster... (Making a huge purchase could be tricky...)

Oh I see - you are the OP and so bumped up your own thread. Yes, the world really did change quite a bit.

I don't try to guess foreign exchange stuff no matter how "logical" a predicted scenario seems. I have a set % amount invested in foreign assets, and as it goes up and down relative to the US$ I rebalance.

 

[Texas Proud]

The dollar changes over time... nothing new....

When I was working in the UK in 2000, the dollar was even stronger than today... the euro was worth less than $1 (I think it got to the low 90s high 80s... just do not remember)... I think that the exchange with the pound was closer to 1.25....


Now, try explaining to someone who knows nothing about the exchange rates that you are actually on budget in local currency but way down when it is converted to US$.... 'Yes, I know we are over budget but the budget was based on 1.50....'.... they just do not get it...


I think that the dollar vs pound was up to 1.80, but only see 1.70 on the chart I am looking at... a big swing...

 

[Gumby]

How did that work out?

Poorly, for the most part. I got out of the real denominated CDs in 2010. I also shifted away from commodities in 2011-12. But I have maintained a substantial allocation to foreign equity funds (VGTSX, DODFX) and that has mostly been a drag on portfolio performance.

 

[audreyh1]

Poorly, for the most part. I got out of the real denominated CDs in 2010. I also shifted away from commodities in 2011-12. But I have maintained a substantial allocation to foreign equity funds (VGTSX, DODFX) and that has mostly been a drag on portfolio performance.

Sounds like your move out of commodities was timely.

International was a drag on portfolios in 2014, but not this year. I rebalanced buying more at the start, and there has been a nice recovery.

I think quite a few people have a large international exposure to diversify away from US assets, but every country/region has its own challenges.

I found your 2009 post very interesting, because things can seem so clear at one point in time, but still turn out completely different than expected. Which is why I gave up investing based on my expectations long ago.

 

[marko]

So now do we come back to this thread in 6 or 7 years from now and again see what we were thinking? Seriously, it might be fun.

I've put it in my calendar for Sept 29, 2021...see you all there, (God willing!)

 

[NW-Bound]

Same as many here, I feared inflation but that did not happen. My overweight in foreign stocks particularly EM and also material sector stocks worked out well in 2009-2011 in the sense that they beat S&P, but then fizzled out. I hanged on them too long, and gave up quite a bit of gain.

But, but, but I have seen in the past that things rarely happen as quickly as people think. When the last person capitulates is the time it finally occurs.