CBBB wrote:Paphitis wrote:gauss wrote:Paphitis wrote:As a result, property and Australian shares are booming
I guess nobody bothered to tell the australian stockmarket that aussie shares are booming...
http://tinyurl.com/25fxr8o
31% in the hole over three years...you could've earned a compounded return of over 15% just by putting your money in the bank, so your booming stocks have underperformed cash by nearly 50% over three years!Paphitis wrote:Also, I told you before that the AUD is pegged to the USD.
While I won't dispute that you told him, you're wrong. AUD was floated in the 1980's, it's not pegged to anything. Quite possibly you don't know what "pegged" means. Please explain what you think it means.Paphitis wrote:The EU is a little irrelevant to our economy and the way we trade our services and products to the world. The Euro is not the choice currency in the Asia Pacific region. In fact, it is not the benchmark currency anywhere!
Again, wrong. I refer you to the weighs assigned to the USD and EUR by none less than the Reserve Bank of Australia for the AUD trade-weighted index:
http://www.rba.gov.au/media-releases/2010/mr-10-22.html
EUR is assigned a heavier weight, which means that in terms of trade in goods and services, the EUR is more important than the USD.
Economics and finance lesson over.
When I was referring to Australian Shares, I was basically taking into consideration the last 12 months or so! The market is riding a mining boom at present and is very upbeat about record jobs growth. Interests rates are set to rise to reduce inflation and slow the economy because the Reserve Bank fears on consumer spending and inflation!
In any case, here is the All Ordinaries index for the last 5 years. Compare this to US and European markets and see where it stands!
The Australian Dollar was pegged to the USD in 1966! Before that, it was pegged to the GBP. Floated in 1980 which means its value fluctuates from the pegged rate of 1AUD=1.12USD. At the moment we have near parity!
Australia's export market dictates that Australia is better suited to trade in USD or AUD at the moment. They do not prefer the Euro, because exporters in the Primary Industry sector and Mining Companies do not find the exchange suitable. As AUD rises, more exporters will just convert to USD.
So basically Bafidis, you don't know what you are talking about!
He is right about the AUD floating in 1980. So it isn't pegged to the USD anymore. But references were more to denote the higher importance of the US Dollar and the Asian markets compared to the Euro and European Markets and the fact that both Europe and the United States are in dire trouble, whilst Asia is growing at a phenomenal rate!
That pretty much encapsulates Paphitis' existence on this forum…
