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The money fed prints doesn't stay in USA. It floods the entire globe trying to find the maximum return it can. That is the reason all stock markets everywhere a

The money fed prints doesn't stay in USA. It floods the entire globe trying to find the maximum return it can. That is the reason all stock markets everywhere are at record highs and commodities are continuing to push upward. As more economies are getting heated, many have started raising their own interest rates to reduce inflation.

mywittyname 5y ago
At some point, we need to accept that The Fed is not God of the World Economy. They can have a major impact on the country's economy, and they can influence foreign markets to a degree, but they are not responsible for everything. They just don't have that kind of power. If commodity inflation is caused by an over abundance of USD, then there would be a whole host of side effects from this. One of which, is as I said, price inflation localized to the USA. The second would be a weakening of USD relative to most other strong currencies. So let's look at that: USD : Euro - Slightly weaker relative to 2020, but overall, right around the average strength over the past ten years. USD : GBP - Same as the Euro. USD : CAD|SGD|AUD - Weaker than 2019, but much stronger than the 10 year average. USD : JPY|INR - Very strong USD : CNY - much weaker than 2019, better than 2018, right about at the 10 year average. It's there, but only slightly. And only after 2-3 years of crazy strengthening.
- option_greek 5y ago
  The USD vs other currencies cannot be compared to USD vs commodities which paint a more transparent picture because no one wants their own currency to be stronger than USD due to export competitiveness getting effected. So whenever USD goes down, they buy more USD with their own currency to keep the peg contained in a range. I know all are supposedly free floats central banks do buy and sell to contain volatility. So the thing that needs to be watched is not the ratio of currency but the USD denominated forex levels which as per my understanding have raised across the board as capital leaves US shoes to these countries. I don't have data to back it up but at least in non tourism dependent economies it is the case.

mywittyname 5y ago

At some point, we need to accept that The Fed is not God of the World Economy. They can have a major impact on the country's economy, and they can influence foreign markets to a degree, but they are not responsible for everything. They just don't have that kind of power. If commodity inflation is caused by an over abundance of USD, then there would be a whole host of side effects from this. One of which, is as I said, price inflation localized to the USA. The second would be a weakening of USD relative to most other strong currencies. So let's look at that: USD : Euro - Slightly weaker relative to 2020, but overall, right around the average strength over the past ten years. USD : GBP - Same as the Euro. USD : CAD|SGD|AUD - Weaker than 2019, but much stronger than the 10 year average. USD : JPY|INR - Very strong USD : CNY - much weaker than 2019, better than 2018, right about at the 10 year average. It's there, but only slightly. And only after 2-3 years of crazy strengthening.

option_greek 5y ago
The USD vs other currencies cannot be compared to USD vs commodities which paint a more transparent picture because no one wants their own currency to be stronger than USD due to export competitiveness getting effected. So whenever USD goes down, they buy more USD with their own currency to keep the peg contained in a range. I know all are supposedly free floats central banks do buy and sell to contain volatility. So the thing that needs to be watched is not the ratio of currency but the USD denominated forex levels which as per my understanding have raised across the board as capital leaves US shoes to these countries. I don't have data to back it up but at least in non tourism dependent economies it is the case.