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Author Topic: USD to unpegged currencies  (Read 1168 times)
cbeast
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January 26, 2013, 06:07:15 PM
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I don't know all the factors that go into this, but the trend is pretty clear.

Similar trends by countries not engaged in the race to the bottom:

http://www.xe.com/currencycharts/?from=USD&to=PLN&view=10Y
http://www.xe.com/currencycharts/?from=USD&to=MYR&view=10Y

Are these the types of countries that can best benefit from severing themselves from the inflationary currency markets and adopting Bitcoin?

Any significantly advanced cryptocurrency is indistinguishable from Ponzi Tulips.
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January 26, 2013, 11:56:05 PM
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I did not see the flickr picture. The link to the MYR chart shows the Malaysian Ringgit dollar rate, and in the beginning the rate was possibly pegged to the dollar.

Pegging is really nonsensical, because if you want the rate to be fixed to some other currency, you could as well use that other currency. The real reason for just pegging it is that they want to be able to unpeg it.

Therefore, a currency that is pegged to the dollar, is pegged only until it is not pegged anymore.

After that they may peg it to another rate, or they promise to keep it within a rate band. When that is given up, they may try to peg it to a basket of other currencies, or keep it within a band of the same. Most currencies today are free floating. Unofficially, they all try to keep it within some unspoken reasonable limits, or at least they try to avoid it changing too fast relative to other currencies.
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January 27, 2013, 12:05:23 AM
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The pic was the ten year chart of USD to PHP which shows a trend of dropping from 55 to 39. I did not notice the currency war thread. I probably need to post it there. What I am seeing is that large countries with sovereign currencies tend to float and deflate, while larger countries tend to peg to USD and inflate. I just think the smaller countries would benefit from Bitcoin to attract commerce since their exchange rates are undesireable.

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January 27, 2013, 12:16:01 AM
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The pic was the ten year chart of USD to PHP which shows a trend of dropping from 55 to 39. I did not notice the currency war thread. I probably need to post it there. What I am seeing is that large countries with sovereign currencies tend to float and deflate, while larger countries tend to peg to USD and inflate. I just think the smaller countries would benefit from Bitcoin to attract commerce since their exchange rates are undesireable.


I dont think that this conclusion can be drawn. The value of a unit of a currency long term is mainly the supply: the number of money units issued, combined with the fractional reserve bank money extension, and the demand: the number of people using the currency and their money holding preferences.
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January 27, 2013, 12:41:42 AM
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Similar trends by countries not engaged in the race to the bottom:

http://www.xe.com/currencycharts/?from=USD&to=PLN&view=10Y


PLN ? Seriously, they keep buying Formula-1 engines in their race to bottom with debt from EU. It's one of the most inflationary currencies on earth.

Inflation in december alone was 2.4%.
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January 27, 2013, 12:45:21 AM
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Similar trends by countries not engaged in the race to the bottom:

http://www.xe.com/currencycharts/?from=USD&to=PLN&view=10Y


PLN ? Seriously, they keep buying Formula-1 engines in their race to bottom with debt from EU. It's one of the most inflationary currencies on earth.

Inflation in december alone was 2.4%.
It looks like they joined the currency war late in the game. I wonder how it's working out for them?

Any significantly advanced cryptocurrency is indistinguishable from Ponzi Tulips.
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