Why is the U.S. dollar so weak compared to the Euro and British Pound?
Seriously, I should start investing there just to get an instant return of 40% with any gains.
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Tagged with: return • Seriously • why is the dollar so weak
Filed under: Currencies
Why would you get any kind of return on your investment? The strength of a currency really means nothing – at most CHANGE in the buying power may be relevant. If currency A is worth half of what currency B is worth what difference does it make whether you have 200 units of Currency A or 100 of Currency B. Japan for instance has the second (or maybe now third) highest GDP and very high GDP per capita but a single Yen is nothing compared to a Peso. This does not help the Mexicans who are much poorer than the Japanese.
This is the same thing with the Euro or Pound vs a dollar. Yes a Euro is worth more but European workers get fewer Euros than American workers get Dollars. So how does that help you? Any return you get will ultimately be measured as a percent of investment so if 80 Euros are worth 100 Dollars 10% return on each would be exactly the same. Also recently the Dollar has been strong gaining to the Euro.
This is because have of the united states printed cash is really based on nothing. 20yrs. ago its was based on the gold in fort knox
The United The United States dollar is fiat money, money with little or no value, whereas the British pound is backed by silver. The United States dollar was once backed by gold.
Weak as compared to when? The Euro as fallen nearly 20% vs the dollar over the last several weeks because of the problem in Greece. As you can see form this chart exchange rates vary a lot, so to make money you have to get the timing right. http://finance.yahoo.com/q/bc?s=EURUSD=X+Basic+Chart&t=5y
What do you mean by weak? Infact U.S. Dollar has been strong, euro and pound been weak lately.
Euro is down from 1.50+ to 1.35. Pound was very close to 1.70 and today its 1.54.
Why would you get any kind of return on your investment? The strength of a currency really means nothing – at most CHANGE in the buying power may be relevant. If currency A is worth half of what currency B is worth what difference does it make whether you have 200 units of Currency A or 100 of Currency B. Japan for instance has the second (or maybe now third) highest GDP and very high GDP per capita but a single Yen is nothing compared to a Peso. This does not help the Mexicans who are much poorer than the Japanese.
This is the same thing with the Euro or Pound vs a dollar. Yes a Euro is worth more but European workers get fewer Euros than American workers get Dollars. So how does that help you? Any return you get will ultimately be measured as a percent of investment so if 80 Euros are worth 100 Dollars 10% return on each would be exactly the same. Also recently the Dollar has been strong gaining to the Euro.