Craig Brozefsky on Fri, 21 Apr 2000 00:20:48 +0200 (CEST)

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Re: <nettime> A16 digest

scotartt <> writes:

> > [ ... ] Australia is a client-state of the US economy. When Wall Street
> > falls so does the Aussie dollar.
> This last sentence is a perfect inversion of the truth. The first sentence
> is true for everywhere. 
> When Wall St falls, the value of the aussie dollar goes up, as investors
> take their money out of the uncertainty of the stock market and invest it
> in 'quality' (ie low risk, low yeild) investments like Government Bonds. 
> The US dollar usually falls after a stock market scare as money leaves
> that economy. A low dollar means we earn more from exports, too, anyway,
> its not "bad" for the currency to be "low" unless you are living
> completely off your credit card and like to buy only expensive imported
> things. 

Not content to take your word for it, I did a short bit of research
and found the following references:

      "Dealers said much of the weakness was due to a recovery in the
       US dollar, as Wall Street's equity market bounced back on
       Monday following Friday's 10 per cent drop on the Nasdaq.

       HSBC currency strategist Mr Tony Cripps said: ``The Aussie's
       weakness is more to do with the US dollar recovering some
       investor support after being sold earlier in line with the
       weakness in US sharemarkets.''

       And with the dollar continuing to find the upside blocked, this
       had opened the way for further near-term declines, dealers

        A charting program which illustrates the relation between the
        two currencies.  Quite nice.

Craig Brozefsky                      <>
Free Scheme/Lisp Software
"Hiding like thieves in the night from life, illusions of 
oasis making you look twice.   -- Mos Def and Talib Kweli

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