*US inflation means deflation for the rest of the world. US inflation means the USD loses its value thus will affect consumer spending and since the US is the biggest consumer in the world, it will have impact on foreign exports to US. Lower export to US means less product to make that turns into massive unemployment. Did you know, one third of Chinese new graduates are currently jobless this year.
1. How severe will the US inflation impact on our country's (RI) economy and stock exchange? It supposedly will affect any country's USD denominated foreign reserves. Most treasurers sell their USD and switch to gold (like China has been doing all this time) or other instruments such as bonds. Indonesia foreign debt is around IDR 1600 trillions. This means foreigners sold/short USD, buy IDR (let's say @ IDR 10k/USD) to buy govt bonds at premium. IF the dollar falls, let's say to 7k/USD, foreign investors will see this as a capital gain and may sell them even at discount. Not good (for you ^_^). Strong IDR is unfavorable though it has some positive effect on the imported things like drugs, heavy machinery and oil consumption. 2. Will it drive the value of oil south? If so, could you please elaborate?! I think oil will go nowhere for sometime and so do other commodities. 3. Many believe that if the US inflation do really happen, gold price shall soars. Will the non-ferrous metal prices climb as well? No. Gold is precious metal and used as hedge to inflation, nickel, copper and tin are non ferrous (industrial). 4. Are there any stock that will rise along with inflation? If so, what sector(s) would it be? Embah has said this, company with USD debt & IDR revenue will benefit from USD decline. Best stock picks? I dunno, currently I only own bonds. lolz.. damn I'm good. (Of course I will sell them when the price is good leh). I'm not trying to scare anyone but we're at war (against economic turmoil), let's face it. http://www.mail-archive.com/obrolan-bandar@yahoogroups.com/msg152335.html I'll tell you a trick: go contrarian on ANY STATEMENT from the officials. If they''re pessimistic, BUY. If they''re optimistic and confident, SELL. Now the fed has just said that the recession is easing, so... you know what to do. Based on the damage of the financial system in the US, I think they need at least ten years for recovery. Buy on US weakness (which can be easily monitored by the strength of its currency index. Chartists! Take note.) Elaine** * 2009/9/13 tV.kun0 <tv.k...@gmail.com> > Dear Pak Hendra Bujang, Embah, Pak Pengamat Market, Pak Yuta, Elaine and > other macro economic experts. > > Please allow newbie to ask a few questions related to macro economic issue. > > Recently I read some news regarding the threat of the US inflation. Below > is some copy and paste from the articles. > > "Buffett is sounding the warning that America's enormous and mushrooming > public debt presents an enormous inflation risk. He points out that private > savings and foreign loans won't adequately cover our huge borrowing." > > "All that spending originates as borrowing, and there's no way it'll ever > be repaid. It'll be inflated away by the Federal Reserve's monopoly on money > creation. That will erode the value of the money in your pocket, in your > bank account, and, yes, in your stock portfolio, too." > > > My questions are: > 1. How severe will the US inflation impact on our country's (RI) economy > and stock exchange? > 2. Will it drive the value of oil south? If so, could you please > elaborate?! > 3. Many believe that if the US inflation do really happen, gold price shall > soars. Will the non-ferrous metal prices climb as well? > 4. Are there any stock that will rise along with inflation? If so, what > sector(s) would it be? > > Thanking you very much in advance for your time to answer. > > s|n > > Sent from my BlackBerry® > powered by Sinyal Kuat INDOSAT > > ------------------------------------ > > + + > + + + + + > Mohon saat meREPLY posting, text dari posting lama dihapus > kecuali diperlukan agar CONTEXTnya jelas. > + + + + + > + +Yahoo! Groups Links > > > >
