Wow... Little off the topic from earthmoving...What a week here in Aussie Stock market has been smashed.... Our dollar smashed to 80 cents from 93.. Where are we all heading the Euro seems like its rooted... USA still on its knees..... Are we in for another GFC?
My opinion on world finances- The World financials are definitely in poor shape. The US and the EU are broke, although both realize it are ignoring it. Canada is in better shape due to petroleum products (They are the leading exporter of oil to the US). I don't know too much about the AU economy. The US and the EU must cut spending and take measures to ease regulations on businesses. A tax increase, deficit spending and more regulations will not help to grow businesses, which growth in the private sector is the only way to increase the tax revenues. Deficit spending helps a few at the cost of the whole, the bill will come due one day. There is a lot of talk of the financial power of China but in my opinion they have a multitude of their own problems. Their biggest problem is their overheated real estate market, with double digit appreciation. This should sound very similar to us in the business here in the US and we know what leads of that. The Communist gov't is taking steps to increase interest rates to cool the market. In addition they are also placing price caps on certain products (real estate) in order to cool the appreciation of these structures. Those two measures at the same time are counter productive, price caps always drive the price up, through reduction of supply, simple supply and demand economics. In a market where there is literally a billion potential customers, the demand for affordable structures will be high, especially at the rate that their middle class is growing. In order to meet the demand for affordable housing, they are going to have to build. When demand is higher than supply, which seems to be the case in China, you will see this situation. Gov't meddling with price caps and interest rates seldom creates the desired effect. How the Communist gov't handles this will be interesting to watch. There is a huge power struggle going on in China between the hard line Communists and the business sector. Further complicating things are how these two factions are commonly intertwined. As far as the Euros value, I see it heading down to par with the dollar, as investors move to the dollar instead of the Euro for the short term. I say short term because the US is not in much better shape financially, so it will probably be quite a roller coaster ride over the next year as this works out.
Yeah I'm spewing, where going to the US for a month in June and the exchange rate is not going to help the budget However I am led to believe that food and accommodation is not that expensive.