[hope_full]

A few questions from an American who's tired of watching the dollar tumble:

1) Should I "invest" in Euros?

2) Doesn't that just mean that I turn my dollars into Euros?

3) What's the best means for doing that?

4) Is it worthwhile or does it really not matter at this point?

(edited for typos)

[seldom_seen]

$this->bbcode_second_pass_quote('hope_full', '2')) Doesn't that just mean that I turn my dollars into Euros?

[Micki]

You should contact these guys; Euro Pacific Capital

And if you are hesitant to do that; at least spend a few hours checking through the video library. I suggest yuou work your way from oldest to newest.

[3aidlillahi]

I've read on here that you can just do it at banks. Call up banks and see if they do currency exchanges. They most likely will. They will try to charge you a fee, like a couple percent. But just haggle your way down and, at least what I've been told on here, you should not have to pay to convert. At least no more than a percent (which is still too high, IMO). Call around multiple banks and get their quotes for bargaining chips as well.

Maybe try doing it at your bank, but using quotes from other banks as leverage. Then, threaten to stop doing business with them (deposits, loans, etc.) if they don't give you the best possible deal. That should scare them straight, especially if you're a long-time customer and/or have lots of money in their system. Banks HATE to lose money, even just deposits.

$this->bbcode_second_pass_quote('', '3')) What's the best means for doing that?

[mrobert]

I hate to ask this ... but can't you (US folks), just walk into a bank and exchange the money in whatever else? I can do that 24/7. When bank are closed, there are a few exchanges open around here.

I pay around 1% above the market-midrates which is very good.

Or easier, can't you buy American Express travellers cheques for examples? I know can buy those in Euros or Dollars here.

[Tyler_JC]

It's very easy to convert money, it's more difficult to get a decent rate of exchange.

I think that buying Euros at this point might be a little risky. The Euro/Dollar ratio has been stuck in the 1.54-1.60 range for months, despite a weakening US economy, higher oil prices, inflation in the states, and a rate hike in Europe.

The European economy is finally starting to slow down significantly and this is hurting the Euro.

The interest rate gap between the United States and the Euro-zone will likely narrow as the Fed raises rates to combat inflation.

Bottom line, I don't think there's much upside left in the Euro.

[pedalling_faster]

$this->bbcode_second_pass_quote('hope_full', 'A') few questions from an American who's tired of watching the dollar tumble:

1) Should I "invest" in Euros?

2) Doesn't that just mean that I turn my dollars into Euros?

3) What's the best means for doing that?

4) Is it worthwhile or does it really not matter at this point?

(edited for typos)

[mrobert]

Well, if you have $10.000, you could invest $1000 in Euros or other foreign currencies.

On the other hand, it appears that the US is doing a great job in preventing people from buying foreign currencies. 4-5% spreads? Worst I have seen here is 1-2%.

I just did some math. Friday, by bank had a 2.46% difference between buying from you or selling you, a foreign currency. I can get around 1.5% in an exchange shop.

[MrBill]

If you open up a discount FX account you should be able to trade FX on spreads of 0.0002 points (i.e. buy at $1.5632 sell at $1.5630). That elminates your FX risk from a falling US dollar, if that is your major concern.

If you NEED euros then you will have to convert them from your US dollar account and put them in a euro denominated account. You cannot keep euros in a US dollar account, but many banks offer dual currency accounts.

The physical transfer of US dollars to euros may cost around 0.5%, but speak to your bank manager. I have gotten to reduce those fees to 0.25% on large transfers and wave the wire transfer charge.

I can recommend ING.com. I do not work for them and I do not have any accounts with them, but I have looked at their various retail FX products and they are quite good. They were offering physical exchanges for around 0.3%.

My brokerage accounts are mainly at German banks as they offer good deposit insurance, but the spreads are similar. Usually a 2 pip spread with leverage anywhere from 20:1 to 100:1. The other option is exchange traded futures and options. See details at CME.com, but a discount FX broker is the more popular choice.

Caveat Emptor. I am not licensed to give individual investment advice, and definitely not to American citizens under SEC Rule 144B. So please consult your own banker, lawyer or accountant. Thanks.

[Peleg]

How can there be any doubt that Europe is better situated to handle peak oil that the US. The dollar has alot further to fall. If there was a mad rush out of the dollar and into the euro that would not be good since there would be reverberations in the global markets, but an orderly growth in the Euro is pretty much a sure thing at this point isn't it? The Pound too is set to remain strong, well unless something major gets going on.

It blows me away how so many analysts from different sectors talk about their part of the pie as if it exists in a relative vacuum. Currencies are so tied to economic stability, which is so dependent on abundant cheap energy that I fail to see how every eye is not on oil prices every day.

The Us current debt I was recently told amounts to something like 53 trillion dollars. that's like 400,000 dollars per household in the US. 400k is more than a lifetimes work for an entire village in many countries. Where do we get the chuztpa to think that the house isn't going to call our margin? It's only a matter of time.

[Peleg]

No sooner than and here comes the experts saying the dollar is going to rise.

Dollar to Rise Against Emerging Markets, Morgan Stanley Says

By Jamie McGee

July 4 (Bloomberg) -- The U.S. dollar will appreciate against most emerging market currencies as their economies are hurt by rising energy prices, according to a Morgan Stanley.

The dollar will also strengthen to $1.53 against the euro by year-end and $1.40 by the end of 2009, Morgan Stanley's chief currency strategist Stephen Jen wrote. The research note was released yesterday after the European Central Bank's quarter- percentage point increase in its benchmark loan rate to 4.25 percent. Jen also forecast the dollar will trade at 97 yen by January and at 110 by the end of 2009.

``While the dollar may remain somewhat vulnerable against the euro in the near term, we continue to believe that the dollar is grossly under-valued and should perform better over the longer term against the majors,'' London-based Jen said. ``It is the oil price issue that will likely cause the emerging- market dominos to topple over. Euroland will likely follow.''

Crude oil rose above $145 a barrel yesterday to a record amid signs global demand for fuels, particularly from China, may strain supplies.

The euro fell the most against the dollar in more than two months after Trichet signaled that he may not increase interest rates again. The euro dropped 1.1 percent to $1.5703 yesterday in New York, from $1.5882 on July 2. The dollar appreciated 0.8 percent to 106.73 yen, from 105.91.

To contact the reporter on this story: Jamie McGee in New York at

Bloomberg reported that. Because oil is denominated in dollars and oil is rising so sharply while demand stays strong? Is that the logic? But they are implying that the US economy is not going to drop off sharply, which would diminish demand for chinese products and.... I wanted to immortalize this analysts claim here so that later this year we can revisit it. I do not believe this will be true at all. I don't know how much but I expect the dollar to keep dropping at an accelerating rate as we move into a hyperinflationary regime near to 2010.

OH PS: I think there has to come in at some point accountibility measures for professional analysts when they say stuff like this. There never fails to be a rash of optimism when they secretly think things might be going south. It's a game that average people are not falling for as much any more. That does'nt seem to stop the rosy cheeked winkers. Europe will raise rates to protect itself if it has to. They are well aware that their currency decisions do not exist in a vacuum.

[BigTex]

Here is a really simple way to do what you are describing (I assume you are just wanting to hold cash in another currency, not actually have the other currency in hand to spend).

There are foreign currency ETFs that you can buy that will allow you to exchange your U.S. dollars for euros, Swiss francs, Japanese yen and other foreign currencies. You will even earn money market returns on the funds held in these ETFs.

The euro ETF is FXE.

The Swiss franc ETF is FXF.

I have started keeping much of the cash in my brokerage account in FXF, since I figure that the Swiss franc is probably as good or better place to be than U.S. dollars. If the dollar miraculously strengthens, then that is a risk I am comfortable with.

[mattduke]

How many pounds of euros can I get for 10 pounds of dollars?

[mrobert]

$this->bbcode_second_pass_quote('mattduke', 'H')ow many pounds of euros can I get for 10 pounds of dollars?

[MrBill]

You think you're witty, but you're only half right.