Saturday, August 1, 2009

Euros to Dollars Conversion - How to Take Profit from the Falling US Dollar

Visit Euros to Dollars Conversion if you look for currency converter.

This weekend I got a call from my uncle. He latterly switched jobs and now runs a small electrician's office. In the flurry of new forms, he realized his 401K was still sitting at his old employer. He decided to roll it over to his new employer.

He's a smart guy. And he's managed to save quite a bit of money.

We then centered our dialogue on where he should invest now. I'm not a fiscal planner, but with additional than 10 years of experience on'Wall Street', I know the markets pretty well. So what should he be looking at?

I started brooding about mutual funds, ETFs, stocks, bonds, the list goes on and on.

Sometimes considering all of the macro-economic drivers influencing these investments becomes mind numbing.

So which is the most important? What ideas should we be paying the most attention to? It's not only my uncle, it's everyone.

Then it hit me.

Reaching into my pocket, I pulled out a mint crisp twenty-dollar bill. And that got me thinking. Not many stockholders focus on the US greenback but I do... And I know just how tough it can be.

What do I mean by that?

I think the US dollar is teetering on the cliff of destruction. I am going to tell you why. Then I'm going to tell you what happens when the US Dollar falls.

First, why does the US greenback fall in value?

With lots of complicated reasons. Supply and demand. The demand for US bucks changes each day. It's the world's reserve currency so it's used around the planet for commercial transactions of all types.

Financiers were fearful of a worldwide economic collapse. They started shifting out of other currencies into the US Dollar. Now that a commercial collapse looks improbable, investors are dumping US dollars to buy other currencies.

With demand dropping, so is the value of the US Dollar. But that isn't all.

Euros to dollars conversion

Before the recession, the federal Reserve was holding the money supply comparatively stable. Now with the recession in effect, the govt. gives away free cash. It seems anyone that can make their way to Washington and still have a pulse is getting a handout. ( infrequently I assume the pulse is optional - anyone can get free money.

Trillions of dollars are being spent by our government.

Are they taking this cash from a savings account? No. They're simply printing more money.

They just wired in a trillion dollars ( give or take ) ... No necessity to print anything. Just poof. Here's a trillion dollars. Don't misunderstand me, it's real money... But it's's skyrocketing the number of US dollars around the globe.

And that implies more supply... Which also depresses value.

If you follow my logic, you'll realize the US dollar is bound to slide in value . And trust me, it's a extremely slippery slope. So aside from the simple, unloading the US Dollar, how do we make money?

I can think of 100 ways...

Invests abroad.

Take some of your hard earned US dollars and invest them in foreign retirement funds or ETFs. By buying foreign investments, you in essence convert your US dollars into a foreign currency. Even if the investments break even, once the US greenback starts falling, you'll be making money.

For example, I just happen to love the concept of making an investment in China. This ETF holds 25 of the largest and most liquid Chinese companies.

I believe you'll be impressed with the potential it provides. As well as the expansion exposure to China, it also helps protect you from the falling value of the US Dollar.
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