Swiss Franc Devaluation

[JDH]

Here are the basics: http://www.theglobeandmail.com/report-on-business/economy/currencies/switzerland-move-threatens-currency-war/article2154389/

Here's an interesting spin on it: http://dld.bz/apmzC

Is there anything to this story?  Or should I just ignore it, since I don't live in Switzerland so devaluation has no impact on me?

Just wondering........

[sunseeker]

My way of looking at it is that most countries are thinking the same way. They don't want a strong currency because that will impact on their competitiveness. But it's not possible for everyone to devalue their currency at the same time. Any movement has to be relative to something else (Einstein).  Since most people price goods in $ , then you could say that the yardstick is the US Dollar. But when the US finds that like Switzerland it's loosing it's competitive edge they too will look to weaken the currency. Ultimately I believe that the yardstick will be gold.

First Link.*
http://www.mineweb.com/mineweb/view/mineweb/en/page96990?oid=134947&sn=2010+Detail&pid=92730

The gold standard used gold partly as a means of exchange, I don't see that happening - the price has to be at least five figures before that can happen and probably quite a large five figure number because it has to match the entire issue of money worldwide and I don't think that is feasible.

But if countries keep devaluing their currencies to remain competitive in the world then is a five figure number for gold inconceivable?

It could be a ten figure, a fifty figure, or an even greater figure number...

Weimar Republic hyperinflation from one to one trillion paper Marks per gold Mark.




http://www.usagold.com/germannightmare.html

If history teaches anything, it is that government cannot be trusted to manage money. When currency is not redeemable in gold, its value depends entirely on the judgment and the conscience of the politicians. (That is the situation in this country today.)

Would it matter what value gold was if gold was benchmark by which all currencies where measured?

BACK TO THE First Link.*

Perhaps we ought to be considering the Venezuela/Hugo Chavez approach to our own portfolios?

he's probably got the largest oil reserves in that part of the world too so his cash flow will be oil, his reserves have now been diversified into the BRIC country currencies and into gold - so going forward it looks a very sound growth portfolio.

Gold and Oil.

ATB