Wanting to discount the currency is why everyone moved away from the gold standard in the first place. The world is fine when everyone wants to have the strongest currency (Germany, Japan and the US have all tried it), but what do you to when everyone wants their currency to depreciate?
If the US jobs number had of been stronger this wouldn't be an issue, now it's poignant to contemplate the Reagan style US currency crash. When will be the worse? Bravest call I've seen so far is 85cents in the 3rd quarter.
More importantly for us punters, is to we gain from this? (I don't think we're here for charity). I think the key will be buying U.S. shares when a turn around occurs. That's the simply bit, when is the key? Personally, I've going to look to start buying around 82c and try to keep buying (selling $AUD assets) until the turnaround.
Ord Minnett (through JPMorgan) have said the fair value (trade weighted) for the AUD is 66-68 cents. Hopefully the currency will run back to that level towards the end of the year when the US is free to sort out their mess, after the election. (Bush approval rating is still around 61% I believe).
Anyway Towie, trying to start your own political party will probably get you 3 years in jail... :-)
