Some interesting currency moves today

[Wd40]

http://www.forbes.com/sites/timtreadgol ... nother-25/

This guy is predicting AUD to fall below 50C to the USD

What no-one seems to have done yet is connect those forecasts, and the worsening trading conditions, with where the dollar is heading and while some people see it dropping into the 60c range the reality is that it is likely to fall further, perhaps down to its 2001 level of 49c.

If that happens then the Australian dollar will have effectively have mimicked the value of the country’s major exports, coal, iron ore and oil (in the form of liquefied natural gas).

Forecasting a sub-50c exchange rate for Australia might seem harsh but that’s because defenders of the currency are either basing their views on hope rather than facts, or because they’re too young to have lived through a recession.

After all, anyone who is 40 years old today was still at school when the last recession hit.

[JR8]

This guy is predicting AUD to fall below 50C to the USD

AUS is heavily dependent on commodity exports, esp to China. No wonder they're getting severely caned.

Time for a holiday down that way?

[JR8]

From an overnight, global markets round-up:

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'The Hang Seng Index surpassed 27,000 for the first time since January 2008 on Thursday, rising as much as 6.8%, as investors from mainland China poured in, reports the Financial Times. "Trading volumes in the first half-hour were 400 per cent higher than the 30-day average as retail investors from mainland China’s market piled in via the Shanghai-Hong Kong Stock Connect," the paper said'.
- See more at: http://www.digitallook.com/news/press-r ... HSLsD.dpuf
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Let's hope this doesn't end in tears...

[JR8]

UK-Telegraph columnist Ambrose Evans-Pritchard doesn't tend to hold back, and here an article of his today.
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'Europe's manhandling of Greece is a strategic gift to Russia's Vladimir Putin'
http://www.telegraph.co.uk/finance/comm ... Putin.html

The article opens....
'The European Union has presented Vladimir Putin with an irresistible strategic prize, on a platter.
By insisting rigidly that Greece's radical-Left government repudiate its electoral pledges and submit to ritual fealty - even on demands of little economic merit, or that might be unwise in the particular anthropology of a post-Ottoman society - it has pushed the Greek premier into the arms of a revanchist Kremlin.
The visit of Alexis Tsipras to Moscow has been a festival of fraternity. On Wednesday he laid a wreath at the Tomb of the Unknown Soldier and spoke of the joint struggle against Fascism, and the unstated foe. The squalid subject of money was of course avoided. "Greece is not a beggar," he said.
"The visit could not have come at a better time,” said Mr Putin, purring like the cat who ate the cream.'... ...
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And it gets worse and worse thereafter. To me, it's simply incredible (i.e. literally not credible), that the embers of this problem are progressively being fanned by the EU themselves into an inferno.

Just amazing [genuine ]

[Wd40]

http://www.bloomberg.com/news/articles/ ... es-in-2030

China's GDP will grow to more than twice its size today, helping the Asian powerhouse to almost entirely close its gap with the U.S.

India, ranked eighth for 2015, will climb past Brazil, the United Kingdom, France, Germany and Japan to take third place in the world ranking. The International Monetary Fund calls India "the bright spot in the global landscape." The country will have the largest workforce in the world within the next 15 years, the IMF notes, and among the youngest.

[Wd40]

Tomorrow is MAS policy day and SGD is already falling. It has crossed 1.37.



On a related note, an article about why the USD is going to remain strong for a long time:



http://www.marketpulse.com/20150413/9-t ... en-higher/

[JR8]

Chinese deflation = SG catch cold
whereas
US Fed eyeing inflation = them hoisting rates.

=> S$ on balance down vs US$?

[Wd40]

http://www.bbc.com/news/uk-32443930

HSBC has said it is considering moving its headquarters out of the UK

"The only even faintly credible option is Hong Kong," said Alex Potter, banking analyst at Mirabaud Securities.
"HSBC is so big and sprawling," said former banker and author Philip Augar. "Would Hong Kong wish to have a bank this big on its balance sheet?"
But the Hong Kong Monetary Authority has said that it would welcome HSBC back to Hong Kong. "HSBC is the largest bank in Hong Kong and has deep historical links with Hong Kong," it said in a statement.

[Primrose Hill]

If I have a penny every time I hearvthat

[JR8]

Quite, it's politics.
The UK (as a whole) popularly hates banks and especially bankers (politics of envy). Despite it probably being our most profitable industry, that pays vast taxes, and really excels within a global context.

If Labour win the upcoming election (May 9th?), it's almost obligatory for them to start re-roasting the 'cash-cow banks'. Hence in reply, HSBC highlighting their supposed mobility makes corporate sense.

[I used to own shares in HSBC, and they're a solid performer. But I grew very tired of the impact of such petty politics upon their share price. You're almost better off with say a 'politically correct/benign' manufacturer of soap; Unilever, though it's yield is nothing of note].

[Wd40]

Quite, it's politics.
The UK (as a whole) popularly hates banks and especially bankers (politics of envy). Despite it probably being our most profitable industry, that pays vast taxes, and really excels within a global context.

If Labour win the upcoming election (May 9th?), it's almost obligatory for them to start re-roasting the 'cash-cow banks'. Hence in reply, HSBC highlighting their supposed mobility makes corporate sense.

[I used to own shares in HSBC, and they're a solid performer. But I grew very tired of the impact of such petty politics upon their share price. You're almost better off with say a 'politically correct/benign' manufacturer of soap; Unilever, though it's yield is nothing of note].

This will keep tax friendly jurisdictions like Hong Kong and Singapore hot forever The other day there was an article about how Australian companies like BHP Billiton and Rio Tinto use Singapore as a "front" to save tax

http://www.reuters.com/article/2015/04/ ... IP20150407

Singapore, despite having few natural resources of its own, has been able to use a tax-incentive programme, combined with its strong financial sector, high standard of living and its large port, to attract dozens of commodity companies to set up on the tiny island.

While Singapore's headline corporate tax rate is 17 percent, some companies can take advantage of its Global Trader Programme giving them concessionary rates as low as 5 percent if they meet certain conditions, such as conducting a high volume of business in Singapore and using local banking services.

Larger companies can enjoy even lower tax rates through closed-door negotiations with the government. Most of the world's largest mining and oil companies, including BHP, Glencore Plc and BP Plc operate large businesses there.

[JR8]

This will keep tax friendly jurisdictions like Hong Kong and Singapore hot forever The other day there was an article about how Australian companies like BHP Billiton and Rio Tinto use Singapore as a "front" to save tax

Thanks, an interesting article.

Perhaps, until there's an even hotter and viable proposition (legal jurisdiction). Meanwhile SG are probably happy, having the local employment and taxes (both corporate and personal) plus global-player Ptes/PLCs/Incs to boast have a presence here.

If ever some of the adjacent countries develop enough to themselves become viable locations, then SG might start losing out. But despite the glaring incentives to develop in such a way, these neighbours simply seem incapable of doing so.

ps -----
'Rio Tinto Group is a British-Australian multinational metals and mining corporation with headquarters in London, United Kingdom, and a management office in Melbourne, Australia.'
http://en.wikipedia.org/wiki/Rio_Tinto_Group

[JR8]

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'In corporate news, Apple fell 1.58% after changing hands at their highest-ever level, following strong first quarter results late on Monday.
The iPhone-maker reported earnings of $2.33 per share, beating estimates by 17 cents, while revenues for the period jumped 24% year-on-year to $58bn against consensus of a $56.1bn.
Following the results, analysts at Cantor Fitzgerald raised their target price on the stock from $180 to $195, while economists at Morgan Stanley lifted their outlook for 2015.'
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$58Bn, that's like, er, the GDP of Luxembourg
Time they split that stock? Maybe 5-1?

[Barnsley]

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'In corporate news, Apple fell 1.58% after changing hands at their highest-ever level, following strong first quarter results late on Monday.
The iPhone-maker reported earnings of $2.33 per share, beating estimates by 17 cents, while revenues for the period jumped 24% year-on-year to $58bn against consensus of a $56.1bn.
Following the results, analysts at Cantor Fitzgerald raised their target price on the stock from $180 to $195, while economists at Morgan Stanley lifted their outlook for 2015.'
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$58Bn, that's like, er, the GDP of Luxembourg
Time they split that stock? Maybe 5-1?

Apple probably emply more people than live in Luxembourg

[Wd40]

Meanwhile USD has come off a lot since the last few days. SGD is now 1.32, EUR is 1.097, GBP is 1.53 and AUD is 0.799.