USD Thinking

Now that I’m in the US I notice how all news is 100% US based in perspective, i.e. it all happens due to US based reasons.

Thus you see stock charts like these:

And it’s all about Trimble has done this, and Trimble did that. Or when you see some currency charts:

it generates US focused articles like this:

Which is funny, because in reality that article is the exact opposite of what’s happening. Currency is not a stock, it’s a ratio of strength, and those downward graphs are showing the amount of foreign dollars you get for each USD, which is the opposite of the stock chart, where you look at the USD cost per single stock, thus if you inverse the charts you’d see the cost of foreign dollars are rising.

Another way to notice this is the price of gold in USD, people are all “oh look at its growth” when it’s also an exchange ratio. Looking at it in AUD it’s not current higher than 2009 prices, thus is it gold or the USD that’s changing?

Also if you look at how the stock-market has grown, you then wonder is the value of everything going up, or is the value of the central currency the USD going down.

The latter is what you’d expect when the Fed has been busy over the last few years creating trillions of new dollars.

2 thoughts on “USD Thinking”

  1. The aussie dollar has been crazy lately. When I was a kid it was like 50c to the usd… now there was talk of a mythical 1.10aud/usd! craaaaaaazy talk.

  2. The AUD also more valued than the Canadian dollar also, which it traditionally has been weaker than.

    I expect the AUD is up due to raw commodity prices, and not being the USD.

Comments are closed.