US Dollars

[Deactivated] on 26/07/2011 - 02:49

So what does everyone think i should do with some US currency i'm holding onto, bought about 10k worth for a trip to the states which did not go ahead, and am now watching it slowly devalue as the aussie gets stronger and stronger.

What do you guys think i should to get the best deal? Hold on to it (don't need it immediately) or sell before i lose some more?

Obviously no-one here can predict the future, but hey won't hurt to get some advice.

Thanks everyone.

BTW, bought for roughly 1 AUD = 99 US cents :(

Financial

Comments

  • kurogaga on 26/07/2011 - 03:11
    +1

    You can't really predict the future. Even the experts get it wrong sometimes. You just have to do what you feel most confortable.

    Options you have(if it is cash you are holding).

    Selling
    Find someone who is willing to give you best exchange rate, hopefully as close to the market value and lowest fee. Even banks are willing to negotiate with you if you have over $1000, shop and compare.
    If you can sell the USD to somebody else, you can do that too.

    Not Selling
    Try find a bank willing to give high interest rate for USD deposit, you get some interest.

    Swapping
    Use USD to purchase certain item, gold, silver, shares or any item that you feel it can appreciate in value or invest. Remember that the other party must accept the purchase in USD, not converted to AUD then purchase (so you get closer to market value).

    Ultimately, the sitting money is worst thing you can do, so better start doing 1 of the 3 options above.

    ** You can of course choose 2 or all 3 options.

    • [Deactivated] on 26/07/2011 - 03:25

      hi kurogaga thanks for taking the time to reply :D
      the money is actually sitting in a bank in US currency account however it does not gain any interest (from what ive seen no foreign currency accounts from the major banks give you any interest).

      I like the idea of buying gold, however as you said i would need to find somewhere that accepts usd so i may need to look into foreign markets etc. not sure how complicated/costly this will be to set up.

      Otherwise i would need to find some1 to trade with and as you said get the closest exchange rate that satisfies both parties. I would be happy taking a hit around 1.02 or even upto 1.04 USD per AUD but right now the banks are at 1.13 and those smaller exchange windows are around 1.09.

      Again thanks for the suggestions i'll have to research a bit further!

  • EnALup on 26/07/2011 - 07:41
    +2

    I dont think, US Dollar is going to get stronger soon.

  • ESEMCE on 26/07/2011 - 09:24
    +1

    Buy lots of stuff from the US in USD and save on the Currency Conversion costs! (the savings will probably make up for the losses you've made and are likely to continue to make until the US economy gets back on it's feet).
    If you're not earning interest, you're also probably better off re-converting it so you can get interest, you're currently losing money 2 ways.
    1) by devaluation of USD
    2) by not earning interest (or saving interest by paying down your mortgage or similar loan)

  • joannatan on 26/07/2011 - 09:36

    by reading the news about us economic, it won't get better. you might buy investment product with capital protection that give you higher return compare than usd term deposit.
    or you might invest in the us share market if you understand about that stock market
    or just go to foreign bank and asked them if they got special usd term deposit rate.

  • mr_fjackson on 26/07/2011 - 10:16
    -1

    you could all ways sell 1/2 of it now and the other 1/2 some time next year. or sell $1000 every 2 or so months and try and dollar cost average. then you don't win or lose (and you can sleep at night)

  • BuyoTheCat on 26/07/2011 - 12:19

    Go for the trip later?

  • SomeGuyOnOzB on 26/07/2011 - 14:23

    If there's some stuff you want, maybe you can put the cash on a cash card with a local branch of a US bank, and use it to buy things onlline from the US, skipping the conversion fees. (Though you'd have to pay for the cash card)

  • MattyD on 26/07/2011 - 15:03

    I believe Aug 2 is the deadline for the US to either (a) congressionally raise credit limits or (b) default on their debts for the first time and lose their AAA rating. Currently, Republican and Democrats are locked in a deadly game of chicken so that if it all goes pear-shaped each can blame the other.

    Read more here:
    http://www.guardian.co.uk/world/2011/jul/24/us-debt-crisis-s…
    http://www.news.com.au/business/ten-things-you-need-to-know-…

    Best case: no problems, the USD may weather the storm and recover down the track. Worst case: massive underconfidence in the USD. Me? I'd offload USD right now per kurogaga's suggestion above.

    But please know I am no financial expert.

    • [Deactivated] on 26/07/2011 - 16:45

      thanks some interesting reading there, as you said, the US could weather the storm but it would be a long before it hits back to the 99 cent level for me to break even, and the potential decline in value is far too great to risk i think? Well thats how i'm making myself feel better anyway.

  • [Deactivated] on 26/07/2011 - 16:41

    well guys thanks for all the info, i decided to offload it all today. lost around 1600 but i figure its worth the peace of mind. imagine all the bargains i could have bought with that 1600 :(.

    btw it's truly awesome how a great a community ozbargain is!

    Edit: now that i think about, i need to buy MORE bargains to save even more money to make up for my loss. Yes i think i will have to justify it that way haha.

    • EnALup on 27/07/2011 - 03:22

      Good call. I should say. Its the worst thing to wait and watch for dollar to rise. If it rises, ur bad.
      Else if it goes more down. you will think, why did not u sell it earlier.

    • BuyoTheCat on 27/07/2011 - 10:00

      I like the way you think.

  • [Deactivated] on 27/07/2011 - 13:47

    Sorry to hear about your loss

    I know its a bit late (after you bought) but maybe for the future trips etc consider the 28 degrees Mastercard, best rate, so you dont lose in the conversion to and from etc.

    Safer than cash.

  • mr_fjackson on 08/08/2011 - 09:55

    well now the AUD is down 4c to 6c sorry random123 but if it makes you feel any better I have been burnt before trying to time the markets. I find it so hard to understand why the AUD has dropped vs the USD

    • joannatan on 08/08/2011 - 10:14

      read this
      http://www.forexlive.com/blog/tag/audusd/
      AUD/USD: Closing In On Recent Lows
      The AUD/USD fell by over 6% last week and it’s opening the new week on a weak note as well. Falling commodity prices, worldwide growth concerns and massive risk-aversion all add up to a bearish scenario for the AUD.
      Next major technical support in the AUD/USD is a previous pivot and the 200-day MA near 1.0300. Resistance levels start at 1.0525.

      aud, cad are commodities currencies. USA either you like it or not still the biggest market in the world and still the biggest consumer in the world and China is the major producer in the world, when the consumer demand reduce then the producer has to reduce their production, and we are the supplier for this producer and we get impact as well, because the demand also reduce, thats why commodities currency got hit when this thing happen.

      • [Deactivated] on 08/08/2011 - 22:05

        yes, who would have thought the aussie would slump so hard so quickly. seems like there are some huge bargains on the asx, but i don't like my chances of picking the right time to buy.

        • [Deactivated] on 10/08/2011 - 13:10

          AUD is massively above its long term average and was always going to fall eventually. (I'm not saying this is a long term trend. The USD can fall again.)

          The USD will get strong when the US economy gets strong or when speculators (rightly or wrongly) expect this to happen.

        • joannatan on 10/08/2011 - 14:21

          the current aud strong is based on higher commodities price, read my above comment. higher the demand of australia commmodities and if the price also keep stable or higher, it will increase the demand of aud.
          and remember about carry trade as well, when something happen in usa, most of them unwind their position as well, if this currency got double impact from the unwind and lower demand and commodities price, you can see the biggest fall was in 2008. it is not about chart anymore mate and it is not about long term moving average.

        • [Deactivated] on 11/08/2011 - 00:15

          sorry but the aud has only recently got so high. Commodity prices haven't increased that much in the last few years whilst the aud has gone crazy. And why does the aud fall every time the us has a crisis if it's all about commodities?

    • retiredfeline on 09/08/2011 - 11:12

      Because the market is irrational. It still sees the USD as a safe haven even though the long term prospects are lousy.

      • [Deactivated] on 10/08/2011 - 13:17

        So which currencies are safe? The Euro/Pound with all their problems? The AUD or other small currencies that could wildly fluctuate due to their small size? RMB or other currencies from countries with untransparent governments that can make huge policy u-turns at a whim?

        There's no real 'safe' currency. The USD is the most stable depite its current weakness. It will be strong again this decade.

        • joannatan on 10/08/2011 - 14:11

          the most safest currency is the country that holding the biggest gold deposit in their reserve, unfortunately, yes usa still holding the biggest gold reserve in the world. do you think usa will be the dominant in this decade, we don't know mate. but a lot of country would like IMF SDR (special drawing right) as the replacement of USD. the second option is RMB, unfortunately RMB is not tradeable currency. The major chinese trading partner so far there are 20 countries that agree to do swap currencies with chinese directly. Thats mean if they do business with china directly, they don't have to sell/buy their currency to usd and then convert to rmb. yes they still need the usd/rmb exchange rate for calculation of the conversion only. it more countries do this, it will reduce the dependencies to usd, in the right time in the future, we might have couple currencies as the world reserve.
          what american government do now, is not fair for other countries, they can print money to pay their own debt, even the value of their currencies reduce, and the other country was held hostage as most of them hold their currencies reserve in usd.

      • retiredfeline on 10/08/2011 - 13:39

        None of them. The whole thing is driven by herd instinct and irrational. Amateurs like us should not be holding significant amounts of cash (meaning notes and easily liquefied assets) in any currency. Unless you have free time to try to outsmart the herd.

        • joannatan on 10/08/2011 - 17:37

          the base of the movement of the currencies should be based on supply and demand that came from export and import from every countries. then add the speculator and investor then the market become mix.

      • [Deactivated] on 11/08/2011 - 00:22

        (to jonathan's big post above)

        So you agree with me! Markets are not irritation.

        The us is strong due to its gold deposits.

        Although your argument is highly simplistic, you are right!

        Your other comments are not really relevant .

        Let's wait 5 years and see who's right!

  • joannatan on 09/08/2011 - 10:30

    aud at 1.0085 now. next 0.9920. amazing right? 10 cent gone very quick

    • joannatan on 09/08/2011 - 14:02

      wooohooo lowest of the day 0.9926, target hit

    • SomeGuyOnOzB on 09/08/2011 - 16:49

      Don't you mean 1.63 cents gone very quickly?

      • joannatan on 09/08/2011 - 22:37

        what is 1.63?

        • SomeGuyOnOzB on 10/08/2011 - 01:11

          Oops, sorry.

          $1.0085 - $0.9920 = $0.0165

          or 1.65 cents (not the 1.63 I thought it was)

          So I was wondering what you meant when you said 10 cents gone very quickly

        • joannatan on 10/08/2011 - 10:36

          i mean 10 cents drop from the highest 1.1080 to 0.9927, that more than 10 cent :) in less than 1 week

        • SomeGuyOnOzB on 10/08/2011 - 15:18

          Ah, thanks for clearing that up :)

  • SomeGuyOnOzB on 09/08/2011 - 16:48

    Does anyone know how to invest in the price of precious metals? :)

    • joannatan on 09/08/2011 - 17:14
      +1

      u can either buy cfd or etf. or buy gold stock such as ncm

    • Car-la-la on 09/08/2011 - 23:20
      +1

      perthmint.com.au

      • SomeGuyOnOzB on 10/08/2011 - 01:13

        is that for purchasing physical metal? (I meant just investing in it; I don't mean to put it in a safe; sorry I didn't clarify earlier)

        • joannatan on 10/08/2011 - 08:26
          +1

          They can keep your gold in their vault and you got certificate of ownership

        • SomeGuyOnOzB on 10/08/2011 - 11:27

          Thanks guys :)

Login or Join to leave a comment
Login Join