Another one bites the dust!

[dutchman]

If it was expected then it stands to reason it'll be almost entirely speculation.

Not necessarily.

Expectations of speculators, bankers, industrial players, etc. do play a role in setting a currency price. But the interest rate, price level of goods (ppp), GDP, productivity of labor, inflation, money supply (influenced by the central bank) and the expectations about them do too. Hope you will forgive me for leaving out the mathematical underpinnings. Haven't worked with it for more than 10 years
The way the Central Banks of the US, UK and EU are flooding the market with money has it's effects because it forces our currencies down relative to the Yen (and others). Yabberdiblabberdy blabla, to cut a bunch of corners: I don't think that the steep rise is heavily due to speculators. The other fundamentals mentioned play a larger role, I think... Properly explaining and researching this will cost me a lot more time than I have for now, so I will leave it here.

I am pro speculating by the way since speculating crowds often push things in the right direction. It is their jobto be greedy and I believe regulatory institutions should maintain oversight and prevent unacceptable risk. The deregulation in the US went a bit too far and a bit too quick for the agencies to keep up with. The selfish protect your own and shareholder interest system didn't work and had resulted in excessive risk taking..
So I do not believe the philosophy that complete deregulation is going to create utopia. Ken Lay, the "project/transformation champion" of the public sector in the US ended up in prison because of the Enron affair. Again, properly explaining this will cost a lot of time, so I will leave it here.
Finally I am definitely not a fan of managers squeezing companies solely to create short term shareholder value while neglecting other valuable factors.
This whole corporate governance/free market thing is a bit of a balancing act I guess. The corporate world leaned over a bit too far and all parties involved need to learn the lessons appropriate. Still, this system looks much better than communism.

Pfffrrrrt, I need beer now. Oh no, coffee. It's morning

 

[snowcat]

Interesting your view on speculators Dutchman, Iv always thought much the same, confidence in the market is vital for anyone selling or producing commodity's, supply and demand is not enough to keep a fair price, as large institutions often have the clout to price set, even under the price production, when the stock market gets involved and theres a sudden price spike, it makes both governments and the end buyers to take a closer look at what there doing........

without the markets many small business would end up in a David and Goliath situation, but it would not be David who would win the round....

 

[zardoz]

Several months ago when it was $2 to £1, there was plenty of importing US made machinery. universal iron workers and the likes. not the case now though as its $1.48 to £1, thats a 35% jump in price when converted. if we had any manufacturing we could flood the world with British made goods.

I sell some hard to find Sherlock Holmes dvds on a Web site that sells in US dollars $. So i get a good return when i convert to UK sterling. I expect to be a multi millionaire by the time I am 120 years old.

 

[dutchman]

Interesting your view on speculators Dutchman, Iv always thought much the same........

....without the markets many small business would end up in a David and Goliath situation, but it would not be David who would win the round....

Hi Snowcat, you did not expect that greedy competitiveness part from a half baked champagne socialist huh?!? Bit of equal opportunity (or fair play) doesn't hurt I guess.

I sell some hard to find Sherlock Holmes dvds on a Web site that sells in US dollars $. So i get a good return when i convert to UK sterling. I expect to be a multi millionaire by the time I am 120 years old.

Zardoz, any chance you are in need of a dealership in mainland Europe? I am planning a career change too. This economics stuff is getting on my nerves now.