Although I am fortunate to still be able to earn some honoraria here and there, I consider myself primarily a retiree. So is my wife. Being “self-funding” – meaning, we have to depend on ourselves since we are not entitled to pensions – we have to be careful with the way we manage our nest egg. The little we have is in either Melbourne or Malaysia.
Both currencies are sinking!!!
An Aussie dollar is only worth about 73 US cents today. Malaysian Ringgit is even more pathetic; it is now 3.91 Ringgit to a US dollar!
It is a loss-loss situation for me and my wife!
While it is Australia’s wish to see their currency going south, since the ‘emperors-not-knowing-they-have-no-clothes-on’ insist this is good for the country, they got what they had wished for. But these ‘emperors-not-knowing-they-have-no-clothes-on’ have largely lost touched with the masses. People are feeling so much poorer there today.
On the other hand, in Malaysia, the ‘emperors-not-knowing-they-have-no-clothes-on’ here say our economic fundamentals are all great, yet the Ringgit keeps sinking. I believe all of us know the reasons; any attempt by me to explain is like my trying to tell folks how to suck eggs. (I might also run the risk of being hauled up on the account on promoting the subversion of parliamentary democracy!)
Because I gave a financial commitment to make in Malaysia, I flew in with AUD20K in cash. Thinking that the exchange rate of 2.81 vis-à-vis Malaysian Ringgit I saw on the money changer’s board two days ago was save enough for me to make the exchange, I promptly off-loaded my Aussie dollars. To my chagrin, Ringgit plunged again yesterday; it was 3.91 to a US dollar and 2.85 to Aussie! Overnight, I felt “short-changed” for a couple of hundred Ringgit overnight!
Whose are these ‘emperors-not-knowing-they-have-no-clothes-on’ that I have been referring?
Those who label themselves economists – by virtue of his or her degree or degrees in Economics!
Oh, low Aussie will benefit our exports – wines, tourism and commodities, blah, blah, blah – since they make us “cheap”, say these conventional ‘emperors-not-knowing-they-have-no-clothes-on’ in Australia.
But how do this benefit men- or women-in-the-street? They simply find that everything seems to be getting more expensive! How many are fortunate to have their income adjusted upwards?
My argument is simple, unless a shift benefits the majority of the men- or women-in-the-street, all the big talks from these ‘emperors-not-knowing-they-have-no-clothes-on’ simply do not hold much water!
Countries like Singapore, Switzerland and China have never attempted to talk down their currency. The ‘emperors-not-knowing-they-have-no-clothes-on’ there do have something on! It is productivity, productivity, and productivity that make the difference! (Remember Location, Location and Location in Property investment?)