The Unfashionable Dollar
Garry White - Wed 07 Nov, 2007
Gisele is a really savvy lady. News emerged today that the world's-richest model has started to refuse to be paid in dollars because of the outlook for the currency. Gisele is said to earn $30 million a year and her sister told Bloomberg that the pouting Brazilian now prefers to be paid in euro and euro alone. The dollar really is severely out of fashion. If you dont act now, you could find yourself wearing the financial equivalent of last season's Jimmy Choos...
Kate Moss is famous for shoveling Colombian products up her hooter in spades, as well as having vile, unwashed drug-addled boyfriends…
Naomi Campbell is renowned for beating up her weaker employees, usually with a diamante encrusted phone - for that extra-glamorous thug effect…
Other models are famous for living on “meals” that consist of Diet Coke and cigarettes, followed by a vomiting session in the bathroom.
How classy and sophisticated they are, eh..?
If this is what it means to live the glamorous life then, frankly, they can keep it.
None of these women are a good example to anyone; if you follow their lead then you are a fool. However, I wouldn’t want to tar the whole industry with the same brush… that would be making a silly generalisation, wouldn’t it?
Astonishing I know, but I have heard that some models are actually reasonably bright. Some of them may even be “clever”… yes, really.
Let’s take Brazilian pouter Gisele Bündchen…
Giselle is a really savvy lady. News emerged today that the world's-richest model has started to refuse to be paid in dollars because of the outlook for the currency.
Giselle is said to earn $30 million a year and her sister told Bloomberg that the pouting Brazilian now prefers to be paid in euro and euro alone.
Apparently, when negotiating recent deals with Pantene hair care products and Dolce & Gabanna she insisted on payments being in the single European currency. This is a wise move for someone in her position and it is a trend that is likely to increase.
However, it’s not just supermodels that are likely to make the switch – although this is likely to happen more and more.
A month ago, I mentioned the potential for currency wars to really rock the market; this could be the death knell for the dollar and result in a widespread move away from the currency. This would have disastrous economic consequences for the world’s-largest economy.
Iraq started to price its oil exports in euros in 2000, and Iran has followed suit. Indeed, Iran wants to go one-step further.
The country wants to open a commodity exchange, which has been called the International Oil Bourse. It would be a petro bourse for petroleum, petrochemicals and gas in various non-dollar currencies, primarily the euro. This would establish a euro-based pricing mechanism for oil trading. Venezuela has voiced its support for Iran’s oil bourse – and so have oil-consuming giants India and China.
Then there’s Russia… The energy-rich state which wants to break US economic hegemony.
Russia has a lot of influence in the resource-rich ex Soviet states such as Kazakhstan. It doesn’t take a massive leap of the imagination to see a slow creeping away from the dollar in these areas.
Morgan Stanley said recently that the decline of the dollar to record lows might turn into a "more violent correction" that requires the US, the EU and Japan to intervene in foreign exchange markets. (Note: Under George W Bush, the US Treasury has not intervened in the currency market once.)
So, although the dollar is not dead yet and good investments still exist on the other side of the Atlantic, it would be best to cut your exposure to non-commodity dollar assets.
As the charming Gisele Bündchen has shown, the dollar really is severely out of fashion. If you don’t act now, you could find yourself wearing the financial equivalent of last season’s Jimmy Choos…
You have been warned…
Regards,
Naomi Campbell is renowned for beating up her weaker employees, usually with a diamante encrusted phone - for that extra-glamorous thug effect…
Other models are famous for living on “meals” that consist of Diet Coke and cigarettes, followed by a vomiting session in the bathroom.
How classy and sophisticated they are, eh..?
If this is what it means to live the glamorous life then, frankly, they can keep it.
None of these women are a good example to anyone; if you follow their lead then you are a fool. However, I wouldn’t want to tar the whole industry with the same brush… that would be making a silly generalisation, wouldn’t it?
Astonishing I know, but I have heard that some models are actually reasonably bright. Some of them may even be “clever”… yes, really.
Let’s take Brazilian pouter Gisele Bündchen…
Giselle is a really savvy lady. News emerged today that the world's-richest model has started to refuse to be paid in dollars because of the outlook for the currency.
Giselle is said to earn $30 million a year and her sister told Bloomberg that the pouting Brazilian now prefers to be paid in euro and euro alone.
Apparently, when negotiating recent deals with Pantene hair care products and Dolce & Gabanna she insisted on payments being in the single European currency. This is a wise move for someone in her position and it is a trend that is likely to increase.
However, it’s not just supermodels that are likely to make the switch – although this is likely to happen more and more.
A month ago, I mentioned the potential for currency wars to really rock the market; this could be the death knell for the dollar and result in a widespread move away from the currency. This would have disastrous economic consequences for the world’s-largest economy.
Iraq started to price its oil exports in euros in 2000, and Iran has followed suit. Indeed, Iran wants to go one-step further.
The country wants to open a commodity exchange, which has been called the International Oil Bourse. It would be a petro bourse for petroleum, petrochemicals and gas in various non-dollar currencies, primarily the euro. This would establish a euro-based pricing mechanism for oil trading. Venezuela has voiced its support for Iran’s oil bourse – and so have oil-consuming giants India and China.
Then there’s Russia… The energy-rich state which wants to break US economic hegemony.
Russia has a lot of influence in the resource-rich ex Soviet states such as Kazakhstan. It doesn’t take a massive leap of the imagination to see a slow creeping away from the dollar in these areas.
Morgan Stanley said recently that the decline of the dollar to record lows might turn into a "more violent correction" that requires the US, the EU and Japan to intervene in foreign exchange markets. (Note: Under George W Bush, the US Treasury has not intervened in the currency market once.)
So, although the dollar is not dead yet and good investments still exist on the other side of the Atlantic, it would be best to cut your exposure to non-commodity dollar assets.
As the charming Gisele Bündchen has shown, the dollar really is severely out of fashion. If you don’t act now, you could find yourself wearing the financial equivalent of last season’s Jimmy Choos…
You have been warned…
Regards,
Garry White
For The Daily Reckoning
This article is from The Daily Reckoning. The Daily Reckoning digs deeper than your newspaper ever dares to bring you the real truth about the stock market...the gold price...oil supply...property trends...interest rates...the US dollar…China's bubble…commodity prices…and much more. And you can sign up FREE!
Interested in discovering the next sector set to blast off? How about learning the specific shares the experts see as the most profitable in 2008? Attend The World Money Show London and hear from 50+ investment experts as they reveal their profitable strategies and provide their specific stock picks. The World Money Show London is being held 30 November - 1 December at The Queen Elizabeth II Conference Centre and will feature 14 panel presentations and leading investment product and service providers. Call today to register for The World Money Show London at 00 800 1414 8888 (international free phone) between 10.30 am -10.30 pm EXCEPT from 28 October to 4 November when hours will be 9.30 am to 9.30 pm because of the daylight saving time difference. Don’t forget to mention priority code #009376. Or visit: http://www.worldmoneyshowlondon.co.uk/main.asp?scode=009376
For The Daily Reckoning
This article is from The Daily Reckoning. The Daily Reckoning digs deeper than your newspaper ever dares to bring you the real truth about the stock market...the gold price...oil supply...property trends...interest rates...the US dollar…China's bubble…commodity prices…and much more. And you can sign up FREE!
Interested in discovering the next sector set to blast off? How about learning the specific shares the experts see as the most profitable in 2008? Attend The World Money Show London and hear from 50+ investment experts as they reveal their profitable strategies and provide their specific stock picks. The World Money Show London is being held 30 November - 1 December at The Queen Elizabeth II Conference Centre and will feature 14 panel presentations and leading investment product and service providers. Call today to register for The World Money Show London at 00 800 1414 8888 (international free phone) between 10.30 am -10.30 pm EXCEPT from 28 October to 4 November when hours will be 9.30 am to 9.30 pm because of the daylight saving time difference. Don’t forget to mention priority code #009376. Or visit: http://www.worldmoneyshowlondon.co.uk/main.asp?scode=009376
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