Currency

Well, well, well! What's this I hear--the Canadian dollar on parody with that of the American? Oh, how things change. A good friend of my family (who happens to be American) was visiting this weekend and, accustomed, as he was, to using his precious American dollars in our stores, habitually unveiled them to a Canadian cashier. The Canadian cashier refused them, all the while smirking, then accepted them and returned standard Canadian change: that is to say, on par, dollar for dollar. In another occasion, our good friend did not have enough Canadian dollars when making purchase and was resultantly forced to leave the item. You see, he had American money in his wallet, but not sufficient to cover the cost; his dollars no longer stretch as they once did. Again I say, Well, well, well!

read more

The Indian stock market the Sensex has risen sharply by more than 5% over the last 2 trading sessions alone.

Catalysing this rise was the optimistic forecast provided by Infosys for the next fiscal year.

What has happened(as it often does) is that the entire SECTOR rises along with the market leader. This is because the leader often acts as a bellweather for the entire sector. As a result other I.T majors have also risen sharply over the last 2 days.

read more

Any investment advisor will tell you that one should diversify one's investment portfolio. But what exactly does this mean?.

An example: say you have $100 to invest and you are considering two stocks - an oil company and an airline firm. If you put all your money on the oil stock, then you will loose a lot of money if the price of crude oil falls. On the other hand, if the price of oil goes up, the airline stock will fall as it's energy costs rise. If however, you put $50 in each the paper value of your portfolio will fluctuate much lesser with variations in the price of crude oil. If you sell at the right time, you will make profits, while reducing the downside risk to your portfolio.

read more

As promised, this article is going to focus on the proposed full convertibility of the Indian currency(Rupee).

True to form, I'll start with a couple definitions:

Current Account: Arithmetic difference between the money spent on imports and that gained from exports.

Capital Account: Arithmetic difference between investments flowing into and out of a country.

read more

A debate raging among the financial world is whether the U.S dollar is overvalued.

You might have read stuff in the financial press about this. Most of this rages around the sustainability of America's current account deficit and whether foreigners will keep financing this deficit with capital investments. Read more about Current and Capital accounts at one of my previous posts.

read more

“In God We Trust�; four words that appear to be an honorable pharse to some but a complete offense to others. By having these four words on currency are we diminishing the line between church and state?

So whose idea was it to put this on currency in the first place?

It was a national crisis that resulted in the phrase “In God We Trust� being placed on America’s currency. During the Civil War, public opinion favored the recognition of God on our coins. As Rev. M. R. Watkinson wrote on November 13, 1861: “From my hearth I have felt our national shame in disowning God as not the least of our present national disasters.�

read more