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  1. #1
    *** Sin Bin ***
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    Default so whats the deal with DOP systematically losing its value to USD ?

    Is it some Dominican goverment action ? it's getting weaker and weaker....from years

    answers from FX specialists are more than welcome ;]

  2. #2
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    I remember when it was 16/1.

    It doesn't matter much as most stuff's priced on the US dollar anyways.

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  4. #3
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    Quote Originally Posted by pollogringo View Post
    I remember when it was 16/1.

    It doesn't matter much as most stuff's priced on the US dollar anyways.
    my guess is that not really all of the stuff....but many things, yes..except salaries ??? ;-)

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  6. #4
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    While there have been recent comments on this; there were many posters stating a couple years ago that the Peso was kept artifically low..???(change rate)
    Who knows what will happen in the coming months and the next 3yrs." Keep your powder dry" in whatever place you deem comfortable.
    In the past there were several of our posters that added their take on this and seemed far more learned than I.
    My personal feeling is the Domincan Peso will continue to tumble regardless of movement of the Euro and the Dollar.
    The US has been comfortable leaving the Dollar weak for years. Whether we still have the ability to strenghten its stance
    is beyond me.
    I hope some of the folks will chime in on this. In the meantime. DO NOT!!!DO NOT!! have any more than your month's expenditures in Dominican banks!!! We are probably all in for a wild ride!!!!

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  8. #5
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    the new tax law will increase the peso exchange because once again, people will realize its better to hold dollars than pesos that lose value. I wouldnt be surprised if it goes up to 42 in a few months, despite the gov. putting pressure on the exchange houses.

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  10. #6
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    6-10% per year devaluation against the dollar is normal and planned. UK pound lost 20 % of value against dollar in 3 months a couple of years back.

    yapask1

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  12. #7
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    government steals money simple story...

    they get richer everybody else in misery

    T.E.

  13. #8
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    The peso was introduced at par with the dollar. It has been falling like a leaf ever since — steep dips and stalls with shallow recovers, but inevitably down. Is that a surprise to someone?

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  15. #9
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    When 20% of the population is living off of the 20% of the population that works and pays taxes,,,and the gubmint continues to promote dependency, sh!t happens.

    Going over the 40 to 1 "barrier" woke a lot of people up...So let's see: Hipolito is blamed for the exchange rate going to 50+, okay it happened on his watch. But his illegal decision to pay back every penny held by BanInter also had two consequences that most do not think about:
    1) The huge so-called "deficit quasi-fiscal" which is the money the Central Bank owes on interest earned when the CB tried to gather in all of those billions Hipolito paid out that caused the exchange rate to go over 50. They did this by offering interest rates that during one auction reached a wee bit over 60% APR!! (Of course this held just for a week or ten days, but people were playing with tens of millions of pesos, so a week or so at 60% APR= a lot of quick money)

    2) Anyway, a lot of the money was taken off the streets, the exchange rate went down into the 20s. Where the free zone companies began to cry..

    And so the PLD, which never tired of reminding the electorate that it was Hipolito who let the exchange rate go to 50, always forgot to mention that the Central Bank's policies (with Hipolito's approval) also kept thousands from going broke!

    And now, the great "keepers of macro-economic stability" are faced with a reality they cannot blame on Hipolito: their social and economic policies have put the DR is a hole they are having trouble getting out of.

    Time will tell....


    These are interesting times.

    HB
    Moderator DR1.com

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  17. #10
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    Inflation is a common but insidious strategery to pay for gubmint debt.

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