Market prediction based on macroeconomic indicators - page 18
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The word "of course" should be underlined with commas - the "educator" should know that....
Well at least you know something! So things are not as bad as they seem at first glance.
There are commas after "well" and after "so" too - an educator should know that....
But the second point was correct, except for the fact that all other countries will follow the USA in raising the rates.
What I see in fact. The yuan is going down, the euro is going up. I don't know how long this will go on, but the yuan has gone into the euro.
What could that mean?
What I see in fact. The yuan is going down, the euro is going up. I don't know how long this will go on, but the yuan has gone into the euro.
What could that mean?
You guys are getting a little complicated. China devalues the yuan by 10%, for example. The production of an export product in China still costs X yuan and it is sold for Y dollars. However, when these Y dollars are converted back into yuan, you make 10% more profit than before the yuan depreciation. Chinese manufacturers love it and are beginning to expand production. Chinese workers also benefit from this, the increase in wages which leads to increased demand and growth in the economy. And imported goods are becoming 10% more expensive in China. The Chinese begin to buy more Chinese goods, which again leads to growth in the national economy. The American export manufacturers receive the same amount of RMB Z for their products exported to China as they did before the depreciation of the RMB. But when they convert that RMB Z back into dollars they make 10% less profit. The U.S. economy suffers.
That's right, except for the imbalance in trade between China and the US.
The US is the biggest market for Chinese goods. And what does China buy from the US?
That's right, except for the imbalance in trade between China and the US.
The US is the biggest market for Chinese goods. And what does China buy from the US?
That's right, except for the imbalance in trade between China and the US.
The US is the biggest market for Chinese goods. And what does China buy from the US?
What I see in fact. The yuan is going down, the euro is going up. I don't know how long this will go on, but the yuan has gone into the euro.
What does this mean?
It's a temporary phenomenon, the point of it is the flight of borrowed capital out of China, back into the funding currency, the euro.
For a while a simple as hell scheme was at work - you take a almost free loan in euros, let's say 10 yuan, you put it into the Chinese stock market (which keeps growing) and for six months you smoke bamboo, after six months you close with 30% profit, return the loan, you pocket 3 yuan. The collapse of the Chinese stock market and the devaluation of the yuan scared people a lot and capital ran back.
Further, one can suppose that if investors smell a future financial storm, they will wait out in a safe haven - the American Treasuries. That is, these capitals will go from Euro to dollar.