Chile Forum

I think I am starting to pass the point of excitement about that peso, to the point of being a bit scarred by the rapid move.

Just a quick edit to the title of this thread. Could not believe it.


1 USD = 629.150

Historic credit bubble collapsing..USD could go parabolic from here...Even Gold may not provide safe harbor...Good Luck!...

parabolic up or parabolic down?

the rise of the dollar against the peso seems so counter-intuitive to me.....i understand that investors all around the world are running for shelter in USD, so the demand is high....BUT....isn't the dollar at risk also? it seems to me that people should be running FROM the dollar, not TO the dollar.

There was an underlying credit bubble in emerging market stocks, bonds and currencies...That debt bubble was fostered in borrowing against Japanese Yen and U.S. dollars....Now, the bubble has collapsed and massive deleveraging in those bubble assets is working in reverse....That liquidation results in the purchase of the JPY and USD...Thus, the strength....JPY and USD rising is the anti-thesis to the bubble that papered over a economic depression since 2002....

so the USD is gaining against all currencies except the yen?

on another thread there was a link to an article that predicts hyper-inflation in the US and devaluation of the USD. i assume that we would want to divest from the USD before this happens, right?

so....the strategy seems to be....move assets into cash accounts as much as possible, wait for what we think is the peak value of the USD vs the CLP and then convert?

these events seem to be happening faster than most people thought they would. i have been waiting to cash out an annuity until january of 2009, because i wanted to do that in the new tax year. but if the rise and fall of the dollar is going to happen sooner than that (is it?), maybe i should cash out the annuity immediately and take advantage of the high exchange rate, even though it means a higher tax penalty....hmmmm...another puzzle.

Not financial advice, CC4, but I doubt that the dollar would permanently peak so soon as within the next four months. Another four years, however . . . .

Depending upon your tolerance for risk and your long term horizon, I think is best to take a deep breath and see how things play out in a few month, a lot of speculation and panic selling is taken place now. Eventually thing will come back up.

I would say average up or down, so if you get caught you get caught with an average. Little nibbles along away.

I think we are good to go for 600 well before the first of the year. The direction the U.S. economy and dollar breaks for the rest of the year however will likely be determined the day after the election. Congress and the Fed are not going to do much as far as injecting any sort of predictability in to the market, but a decision about what sort of economic policies to expect for the next 4 years might.

I see the fed injected 600 billion in liquidity again today. It is a super currency black hole of the credit markets.

What we've seen up to now is nothing compared to other predictions for the next day to two weeks.

So yes, if you are not a trader, wait till the dust settles a little but be prepared for the worst with cash in hand and a well stocked plan.

The relief phase might only be a week before the next shoe drops so act quickly.

Then there are important questions since everything seems to be turned upside down these days that may no longer be hypothetical:
(1) Will there be an election?
(2) If there is an election, will there be a Jan 20 inauguration and proper constitutional transfer of power?

i have no problem being patient. it is to my advantage to wait until 2020 to cash out my annuities. i avoid a 10% early distribution penalty that way. but if they are only going to be worth a fraction of what i put in because the dollar devalues dramatically sometime in the next few years, then i should take the penalty and act sooner. i'd like to take ownership of some land in southern chile BEFORE my annuities lose 95% of their value. it's back to the question....when is the catastrophic collapse coming, the one that destroys pension funds around the world? (rhetorical question...i don't expect anyone to have a firm answer).

Nobody has the answer to your question. Having said that, right now is not the best time to come out.

In fact is a good time to go buying..

cali, I do hope you know what sort of paper your annuity is invested in and also the strength of the company that issued the contract.

Buying paper assets now would not be for the faint hearted. I salute anyone with the guts to do it. Proceed at your own risk ...