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  1. #4891
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    Quote Originally Posted by PICHARDO View Post
    Misleading as always!

    It was stated that the DR gov undervalues the DR peso in order to have a competitive edge in the exports market, nothing more, nothing less. The actual index for the DR pesos VS the US dollar can be easily obtained by forex values in the last 10 years with 10 other US dollar to FOREX countries values.

    The US has been pushing the DR (via the IMF which is why the DR halted the loans and offers from the IMF for several years now) to adopt a more liberal (read REAL) exchange format.

    The DR is NOT competitive when compared to other equal or lesser export markets in the region. In fact, it's because of the undervalued pesos that the export sector is still holding on.

    I have posted here plenty a times about clear indications to this, based solely on a YEN to USD to DOMP comparisons at the FOREX with high aberrations.

    If the DR allowed for a true FOREX based on a real floating value, the exports would drop by half within a year. Not to mention the hit to the flourishing tourism industry.

    It's that simple, yet so hard for nay-sayers to grasp!
    You said a hell of a lot of nothing - for my stupidity to comprehend so, could you please explain with details and simplicity - how exactly is it that a country willfully would undervalue their currency, to gain what?

    Make it simple dude, I'm an idiot - go.

  2. #4892
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    Quote Originally Posted by Wishing you well View Post
    You said a hell of a lot of nothing - for my stupidity to comprehend so, could you please explain with details and simplicity - how exactly is it that a country willfully would undervalue their currency, to gain what?

    Make it simple dude, I'm an idiot - go.
    Many countries purposefully undervalue its currency. Russia. China.

  3. #4893
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    Quote Originally Posted by Wishing you well View Post
    You said a hell of a lot of nothing - for my stupidity to comprehend so, could you please explain with details and simplicity - how exactly is it that a country willfully would undervalue their currency, to gain what?

    Make it simple dude, I'm an idiot - go.

    There are several reasons of why countries (some) undervalue their currency.
    First is exports, an undervalued currency will increase exports as goods are now cheaper and don’t need to wait years until their industries are competitive against other export markets.

    External currency shocks, once a country devalued their currency, they can simply adjust the flow for narrow and broad money in short notice and thus curtailing the real shock caused by quick market volatility. Which tends to run dry most CB and their interest counter-shock solutions.

    Imports, if you devalue your currency, imports are therefore more expensive and by this action you can keep a lid on the imports growth. This in turn helps the local suppliers as their goods see increased demand pushed by the artificial chokehold.

    Inflation, this is perhaps one of the most important benefits of currency manipulation. This is where the undervalued currency deflates inflationary tendencies due to real economics pressure on the purchase parity value of said currency.

    That’s just the short list of the many factors that can be obtained by currency devaluations.
    One Dominican at a time please!


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  5. #4894
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    Just recent:

    Dominican Republic defies volatility to print new bond

    NEW YORK, May 29 (IFR) - The Dominican Republic defied market volatility on Wednesday when it raised US$2.5bn equivalent through a well-received two-part deal that included a local currency tranche.

    While several US issuers stepped down on Wednesday as the escalating US-China trade war continued to spark growth fears, the sovereign took its chances with a two part deal comprising a US dollar 30-year and a peso-denominated seven year.

    "It is not the day to put out a global Dominican peso deal but they did," said a banker.

    By early afternoon, books on the dollar tranche had reached US$4.1bn-US$4.3bn in size, helping leads tighten pricing 20bp from start to finish before launching a US$1.5bn 30-year at US Treasuries plus 380bp.

    Once banker had the existing 2048s trading at a spread of around 370bp making for a new issue concession of anywhere between 5bp and 10bp, depending on calculations for the curve extension.

    "This transaction has been long in the works, we've been waiting for it for some time," said an investor.

    "It is a well-liked credit so these guys don't have to come with much of an issuance premium, nor do I expect they will," said an investor following the deal.

    The dollar bonds were trading at around 0.90-1.15 over reoffer in the grey market post launch, according to a trader.

    The seven-year peso tranche, however, got stuck at initial price thoughts and didn't budge from there to launch with a US$1bn equivalent size at a yield of 9.75%.

    With the country's 8.9% 2023 global linked peso notes trading at a bid yield of around 8.90%, the investor thought the pick up substantial.

    "If you're willing to take the DOP risk, it's a fair trade in my opinion," he said.

    ROCKY BACKDROP

    Ongoing economic uncertainty stemming mostly from US/China tariff negotiations has prompted a significant rally in US rates.

    The lackluster backdrop, which saw 10-year US Treasuries drop to 20-month lows of 2.264%, had many questioning whether the sovereign would go ahead with the deal.

    "The Dominican Republic could have been pickier in timing. But they're not desperate for cash and things could always be weaker," said the investor.

    With the yield on the 30-year US Treasury hitting around 2.69% on Wednesday - its lowest level since December 2017 - the sovereign was set to pay a yield of around 6.50% on the dollar bond.

    That was more or less where it came with its last 30-year in February 2018 when it issued the 2048 at par to yield 6.5%.

    Leads Bank of America Merrill Lynch and JP Morgan acted as leads on the transaction, which is expected to be rated Ba2/BB-/BB-.

    Source:

    https://www.google.com/amp/s/www.nas...0529-01243/amp
    One Dominican at a time please!


  6. #4895
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    Books on Dominican Republic dollar bond breach US$4bn: investors

    NEW YORK, May 29 (IFR) - Books on the Dominican Republic's new 30-year dollar bond swelled to over US$4bn earlier on Wednesday, two investors told IFR.

    The sovereign is approaching investors with a benchmark US dollar 30-year bond with initial price thoughts of US Treasuries plus 400bp and a seven-year local peso bond with IPTs at 9.75% area.

    By early afternoon, books on the dollar tranche had reached US$4.1bn-US$4.3bn in size, while the local currency tranche saw demand of around US$1.25bn-US$1.4bn equivalent, sources told IFR.

    "It is a well-liked credit so these guys don't have to come with much of an issuance premium, nor do I expect they will," said an investor following the deal.

    Source:
    https://www.google.com/amp/s/www.nas...0529-00915/amp
    One Dominican at a time please!


  7. #4896
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    Pichardo does not understand what simple explanation means. He understands obfuscation and subterfuge very well though.

    Here is a simple answer "Wishing You Well".

    If you sell your product cheaper than your competitor you sell more, right?

    So there are choices. Some you can make and others you can't. Either make your product cheaper or make your money cheaper. You can affect one but not the other.

    Only governments can make money cheaper. If your money is cheaper, those with stonger money will see your product go down in price.

    Is that simple enough "Wishing You Will"?
    Last edited by Onions/Carrots; 06-16-2019 at 06:25 AM.

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  9. #4897
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    Quote Originally Posted by Onions/Carrots View Post
    Pichardo does not understand what simple explanation means. He understands obfuscation and subterfuge very well though.

    Here is a simple answer "Wishing You Well".

    If you sell your product cheaper than your competitor you sell more, right?

    So there are choices. Some you can make and others you can't. Either make your product cheaper or make your money cheaper. You can affect one but not the other.

    Only governments can make money cheaper. If your money is cheaper, those with stonger money will see your product go down in price.

    Is that simple enough "Wishing You Will"?
    Pichardo is a Dominican operative. of course you will never get a straight answer from him. I also can't believe this thread is 11 years old.

  10. #4898
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    Quote Originally Posted by Onions/Carrots View Post
    Pichardo does not understand what simple explanation means. He understands obfuscation and subterfuge very well though.

    Here is a simple answer "Wishing You Well".

    If you sell your product cheaper than your competitor you sell more, right?

    So there are choices. Some you can make and others you can't. Either make your product cheaper or make your money cheaper. You can affect one but not the other.

    Only governments can make money cheaper. If your money is cheaper, those with stonger money will see your product go down in price.

    Is that simple enough "Wishing You Will"?
    Thanks for being objective and providing altruism.

    Will never get that from Pichardo as he loves to touts "shiny new things" being bought by the DR politicians to enrich themselves as they always do.

    I get the explanation -- hoping Pichardo get my point.

  11. #4899
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    Quote Originally Posted by Onions/Carrots View Post
    Pichardo can point to the product of massive global central bank intervention and claim victory. In his book, the ends will always justify the means. So, if adversely tinkering the global economy via interest rate manipulation gets the job done, then so be it. If you get brand new buildings, Porsche dealerships, a Marriott here and there, then the job has been done correctly.

    .
    You see what I mean by "shiny new toys?"

    He loves them!

  12. #4900
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    Quote Originally Posted by El Rey de Mangu View Post
    Pichardo is a Dominican operative. of course you will never get a straight answer from him. I also can't believe this thread is 11 old old.
    It’s 11old because it takes them that long to accept they were wrong, dead wrong!
    I just enjoy it for so long!!!!!!

    DR economy? Good or good?

    Hhhhhhhhhhh
    One Dominican at a time please!


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