EYE-BALL Guru on – An example of a Government truly concerned about Currency appreciation …
An example of a Government truly concerned about Currency appreciation …
|The Swiss are regarded as some of the best the money managers of the world – and they have endured to maintain that reputation. Some 12 months ago when the Euro first came under pressure as the EuroZone crisis deepened, the Swiss came up with a plan to protect their currency from becoming a ‘safe-haven’ investment thus making its economy suffer. They ‘pegged’ their currency or put a floor to the Euro at SF1.20.
Australia has had the same problem with currency appreciation since the mid 2000’s, but this ‘dumbass’ fuckwit of a Government, and their predecessors with a equally ‘dumbass’ RBA have stubbornly taken a different approach. The Government want to change Australia’s Industry focus and modernise everything – they want to give up tourism, manufacturing, retail and any other industries who just can’t compete in a global economy where the high A$ has priced them out of the market.
The RBA and Government could have done many things if they wanted – they chose to just let the capital flows come in and suck Australia dry due to its reliance on high interest rates relative to our major trading partner,s and its ‘cash and carry’ trade opportunities.
The Swiss are again thinking ahead of the curve trying to protect their competitive edge and their economic future. They see the collapse of the ‘Euro’ and are preparing for its outcomes.
The following ‘Wall Street Journal’ story has prepared the world in the event that the Euro does go into freefall – it’s telling the world that if you but Swiss Francs – then there will be a fair price to pay for the safe-haven experience.
The story is published below: [On-Line link to story.]
This story is a sign of a thinking Government who knows what ‘capital inflows’ can do to economy. It shames the RBA and Government of Australia when all they monitor is ‘inflationary pressures’ and use interest rates to stabilise the economy. The A$’s mean average since it floated in 1983 averages A$0.75c against the US$ – the rise in recent years is directly responsible for the 10,000’s of job layoff’s and business shutdowns across the Nation. Reskilling a workforce for a mining boom of the future – that has been 10 years in the making – this is a course of action that is extreme ‘high-risk’ to say the least, it is also short-sighted in that Brazil and African resources are coming on-stream and will be ultra competitive with Australian resources. This Government has the imagination of a ‘turtle’ figuring a way to cross a road.
Also – this Government will be long gone when the reality of their ‘asleep at the wheel’ responses are exposed. Millions of families and the future of this Nation is being exposed due to the incompetence of the RBA and the Government. Both sides of Politics are a party to the RBA’s charter and the RBA can only do as instructed by the bi-partisan agreement over RBA policy.
EYE-BALL Guru has been at this Government and the RBA with direct contact for nearly 2 years on this single point – since this blog started in fact – and not a thing has changed. The World’s Best Treasurer – Wayne Swan is the greatest dunce in the World on economic matters and in how to manage an economy. All they see is an opportunity to whack the mining industry with a great big new tax – (MRRT) and that all the other industries need to face up to the fact that this is where Australia is putting all its eggs.
At least the Swiss have a track record that others can respect – Australia should learn a lesson.
The EYE-BALL Guru …