Is it time to worry?

Simon & Nicky

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Feb 3, 2004
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Morning all, seen the exchange rate? Dollar has dropped to the magic 40 - yes 40 pesos to the dollar. Have I missed something? Perhaps Bear Sterns have said the national debt has been waived, perhaps all the international big money players are going to invest billions to rebuild the countries infrastructure overnight, perhaps all the hospitals are fully stocked and the staff have actually been paid, perhaps all the electricity supply will now and always be 24/7.

I know for a fact that shop and restaurant prices have started to tumble to reflect the "new mood" and lower exchange rates which are filtering through the economy - yeah right!

Oh! and as opposed to the rest of the world, the DR is also to be given an unlimited supply of free oil and gas!

As we say in the UK Leonel is going to have to sh*t marigolds.

This is starting to get serious - how much further can it slide? There is nothing, absolutely nothing (apart from hot air) to prop up the peso. In the few months that I've been here I've seen things deteriorate even further. How much lower can they go? And yet, is Hipolito that clever that he can orchestrate a mini boom and sudden collapse just as Leonel takes the reins? I don't think so. This could well be a long term problem for some of us.

Do we have an expert on the board?


Simon
 

Escott

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Jan 14, 2002
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It is truly amazing how this has been going against the grain. When they say that default is imminent the peso gets stronger:) Go figger!

What goes down for no apparent reason goes back up. I think this may be a final fling for the mafia in power to get dollars from pesos they stole.

I can use some pesos also. Everytime I need to exchange dollars for pesos the rates drop. That also can be the reason.
 

Conchman

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Jul 3, 2002
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They (hippo's gang of thugs) did the same thing in November 2003 and June 2004, artificially pushing the rate down to buy dollars cheap, let the bubble burst and cash in by selling them a few days later.

With the current shape of the economy, it makes no sense whatsover that this push is 'market' oriented, it has to be artificial - probably hippo's people making deals with the big exchange houses and banks.

Its their last 'rape and pillage' run on the country.
 
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Lambada

Gold
Mar 4, 2004
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I agree, it is an artificial tweak. Compare by looking at rate of dollar to pound sterling. In January U.S.$ was 1.82 to pound sterling approx, same as now. Yet peso was 54.1 to dollar in January, whereas 40/41 now. So it is not linked to world currency markets, it is internal.
 

gringo in dr

New member
May 29, 2003
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There is no crunch for dollars. The government isn't paying any bills. Why would there be a need for dollars? With so much free USD floating around here the peso looks strong. Give it a few weeks for the bottom to fall out.
 

Lechero

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Aug 11, 2004
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What is wrong with that equation?

Something smells!
I agree with The Conchman theory.
It's Hipo's last hurrah.
Boy we forget fast.
Remember in February The Peso went from 49 to 43 in a half hour!
This is just opening side of a new FOREX trade.
Let's watch the thugs buy dollars @ 40 and sell 'em back out at 47 -48.

NICE TRADE!
 
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Mirador

On Permanent Vacation!
Apr 15, 2004
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We're overestimating Hippo. He alone can't pull it off. Let's here it from learned economist on board. I'd like to know who are the big US$ buyers. I imagine these would include Shell, Verizon, Orange, Uni?n Fenosa and the energy distributors (edes), and all those who need to cash in their pesos every month and ship out their profits. Why would they be holding out?

Mirador
 

Simon & Nicky

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Feb 3, 2004
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Maybe I've got the midas touch?

Immediately after my post the rate bounced back to 42. Maybe I should moan some more?

I've heard it rumoured that George Soros has his finger in the pie. He took Britain to the cleaners a few years back and swiped our entire national reserve; but to suck the very marrow from the bones of the Dominicans seems a tad unfair. Perhaps if he's reading this he'd like to comment!!! ;)

Simon
 

BushBaby

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Jan 1, 2002
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I have TWO theories as to why this drop has happened.

1) Hipo promised the IMF to get the rate of exchange back to 40 - 1 so that he could get the accord back on track. He has manipulated the figures to meet his promise (part of his 99% completion of promises???).

2) We all know the current rate SHOULD be in the region of 45 or 48 - 1 at the moment - it has been "tweaked" over the preceeding weeks to look better for Hippo! For him to reduce the rates still further to 40 - 1 will mean a harder 'selling' job by the PLD in four years time when they lay their election platform with the RD $ at maybe 45 - 1!! Hippo will turn round & say "Well, I left the rate at 40 - 1, so you have allowed it to fall from the level I left it at!!

as mentioned by ALL on tis board, this is merely politically motivated, we just haven't been able to see what the true motives are just yet & it is unlikely we will until Hippo starts shouting "Ah well, when I was in power .........!! I hope we all remember the truth of today when he DOES start his lies in 3 1/2 years time!! - Grahame.
 

pasha

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Sep 4, 2003
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Damn Lambada, but....

Lambada said:
I agree, it is an artificial tweak. Compare by looking at rate of dollar to pound sterling. In January U.S.$ was 1.82 to pound sterling approx, same as now. Yet peso was 54.1 to dollar in January, whereas 40/41 now. So it is not linked to world currency markets, it is internal.
that`s one fine analysis.
 

Lambada

Gold
Mar 4, 2004
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Sorry I couldn't include dinar or dirham, pasha! Actually I'm not sure which country you are in!
Tonight we learn that Government plans to pay 2013 bond coupon, & have written cheques to Central Bank in pesos, with which CB buying dollars in order to pay the debt. And of course CB doesn't want to spend too much to buy dollars, so maybe now we know why peso strengthened so dramatically!
 

pasha

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Sep 4, 2003
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That would be....

Lambada said:
Sorry I couldn't include dinar or dirham, pasha! Actually I'm not sure which country you are in!
Tonight we learn that Government plans to pay 2013 bond coupon, & have written cheques to Central Bank in pesos, with which CB buying dollars in order to pay the debt. And of course CB doesn't want to spend too much to buy dollars, so maybe now we know why peso strengthened so dramatically!
UAE Dirham...but it never fluctuates and has been pegged at $1USD to 3.65 AED since Christ was in knee pants.

Best, P