Saturday, October 25, 2008

Ridiculous rates!

OMG, seriously has anyone been keeping track of the exchange rates lately? My job has me looking at them frequently lately, so I'm probably more up to date than most, but I'm sure you all realize the turmoil the stock market and financial districts across the country, as well as the world for that matter are doing. The UK, Ireland, and other countries around Europe have been pulling similar "socialist" acts as the US bank bailout, but all attempts to save the sinking ship that is the world economy seem like a bucket brigade for a 5-alarm fire. I've recently found that I have one friend who lost their job as a direct result of this, with very little warning and no severance of any kind.

I personally don't really think the bailout was that good of an idea and wouldn't mind those to blame for the whole deal to writhe in the filth of their own makings (e.g.: the people who loaned beyond their means and the banks that goaded them into it), but that's easy to say from way over here on the other side of the world. From here though, it didn't look like the bailout was very popular on that side of the pond either, signaled by the fact that it took 2 times for it to pass. My favorite report on the whole thing came from our friend Jon Stewart over at the Daily Show, with a series he calls "Clusterf#@k to the Poor House":

, shockwave-flash@!flashvars#videoId=186776" href="" id="">

Anyway, over here we have an entirely different problem - the Japanese Yen is probably the only currency in the world that wasn't hit hard by the bank fallout, probably since Japanese banks went through a similar crisis about 7 years ago and are already on the way out of the whole mess. While currencies around the world are dropping like a tactical nuke on Iraq, Japan's Yen remains the financially robust stalwart that is weathering the storm - the beacon from the lighthouse shining over these rocky financial times if you will. The problem is not only that the US Dollar, Euro and all currencies tied to them are falling around the world including the British Pound, Canadian Dollars, NZ Dollars and Australian Dollars which I've been watching, but also that many people around the world are buying Yen because of the security they provide, which drive the price even higher. What do you get then? Well you get 93.9yen to the USD when the rates were at 107 just a month ago, or 127yen to the Euro which was at 160, or 150yen to the Pound which was at 200. That is a full 33% increase on the value of the Yen related to the Pound, meaning that if for example you wanted to buy something from Japan that costs 2million yen you will now have to pay 13,333Pounds instead of the 10,000 price of a month ago.

In short this means that I as an exporter currently have a large uphill battle in front of me and am pretty much forced to weather the storm. Shit. Worldwide recession? I think it's a possibility.

Now of course the flip side of this is that it would be a great time to send money home... if I had any to spare. Damn moving fees.

No comments: