Link to a superb write-up, dated 3rd October 2010, by Daniel Solin titled ‘How to Protect Your Investments from a Falling Dollar’
The author argues that currency markets (like the stock market / any free financial market) are ‘efficient.’
The market is all knowing-and whatever people believe they know (exclusively)...unfortunately (for them) the market ‘knows it too’-hence all competitive markets are efficient!
Publicly known information is already factored into the markets-currency or stock or any other free market.
Hence attempting to outguess the market is futile-just buy index finds!
http://www.dailyfinance.com/story/investing-basics/how-to-protect-your-investments-from-a-falling-dollar/19653202/
For things like the currency market, how important do you think is the relationship between currency exchanged for goods traded and currency exchanged (demand and supply created) for financial considerations? The demand and supply of currency for goods traded would alter the dynamics of those trying to use information available to make the mkts efficient!
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