justchillin0440 wrote:
- quote -

If you are really confident that the USD is going to drop 40% in the
near future then buy a bunch of CDs denominated in Euros or some other
foreign currency you favor. If your predictions come true you will make
a killing. There are internet banks here in the USA (I forget which)
who will sell you CDs denominated in a number of foreign currencies.

I personally think its going to be a wild ride in the financial world
if and when the Chinese devalue the Yuan. I don't think there is any
reliable way to predict how things will shake out.

Andy

It looks as if the Chinese government is going to be forced to re-value
the Yuan. The Yuan has been pegged to the dollar for many years,
meaning that the two currencies change value in unison on the world
market. The United States is putting pressure on the Chinese government
to move to a floating currency and will likely get their way in the
near future. I have heard reports and speculation that a floating
Chinese currency could raise the value of the Yuan by as much as much
as 40%. Newton's law of equal and opposite reactions would imply a
subsequent decrease in the value of the dollar by 40%. The bush
administration is pushing for this change in an attempt to close the US
trade deficit (perhaps wisely), however I am afraid of the implications
this will have for unsuspecting middle and lower class Americans who
will find that their dollars purchase fewer goods at the local Wal-mart
and Target (goods that are largely imported from China). I would like
to hear what the group has to say about strategically planning ones
investments in order to benefit from this shift.


======================================= MODERATOR'S COMMENT:
Please respond in the context of financial planning.