(37 days ago)
On November 3, the Egyptian Central Bank removed all exchange-rate restrictions and raised its benchmark rate by three percentage points. This was done to obtain that all-important $12-billion bailout loan the IMF had provisionally agreed to provide in August, though by November 3, the IMF’s executive committee still hadn’t ratified it.
In the unofficial market, the pound had already collapsed against the dollar. With the peg gone, the official exchange rate instantly plunged from 9 pounds to the dollar to over 15 pounds to the dollar, and four days later it was at 18 pounds.
On November 11, the IMF stopped dragging its feet and ratified the $12-billion loan.
At today’s rate of 17 pounds to the dollar, the currency has lost 48% of its value since November 3. This chart, showing the value of each pound in US cents, depicts that plunge in its horrific brutality:
This is an argument for not owning Egyptian Pounds - It does not logically follow that one should own gold, a point which remains true even if you substitute "USD" for "Egyptian Pounds".
(37 days ago)
I was in Canada some time ago.... had a beer with an old friend .... I was mentioning that instead of keeping all spare cash in cash I had a good chunk of it in gold...
He thought that was not such a good an 'investment'
I told him it was not an investment rather it was a hedge against a currency devaluation ...
This was not long after the CDN had been hammered by 25%.... now if one had 100k CDN one lost 25% of that vs the USD ... whereas if one had 100k in gold one essentially still had 100k in USD....
Doesn't apply to the HKD so much as it is pegged... however big picture.... China and Russia are continuing to accumulate....
Grant Williams makes a great deal of sense when he suggests why they are doing that....