Back agan to the same concept of purchasing power capability, and the fact tht you are a high-earner. Anothr who earns less wil not be able to save.

China before they went on their export driven growth has a strong currency. Before they opened up, they purposely devalued their currency to gain a competitive edge over other exporting nations.

We nearly went bankrupt because of the strong ringgit back in 1997, not weak ringgit. Back in 1997 when the 1USD=RM2.5, our foreign currency reserves was only around USD15 billion. Why? Because of our strong ringgit, many people sent their children to study overseas, borrowed in foreign currencies and bought a lot of imported goods until we have trade deficits.

hmm... top end of my estimate 15-20 sen.

oil price rise 10%, rm/usd appr 4%, petrol price still up 10%.

stronger rm doesn't help petrol price then.

Not really, in Malaysia I'm getting rm4000 and my savings are at minimum, about rm2000.
But in Qatar, I'm getting about double, but I use minimum only, as transport and food are paid by company, as long as I'm working.

Correcion - only countries tht have reached a high threshold of debt to GDP will want to lower weaken ther currency in order to fuel exports. Fueling exports will effect exporting more than imprtng, hence reducing the trade deficit, and perhaps even initiating a trade surplus.

Wth surplus, mor funds wil come back to the country, and the secnd effect is GDP rises. When GDP rises, the ratio of debt to GDP drops, assuming the country does not increase its debt level further or faster.

In 1997, big wan tan mee only need rm2.50, 2015 a big wan tan mee need rm5.50
Cannot compare like that.

So, we devalue our currencies, but I never see export increases
But I do see more job cut in Malaysia

You only need weaker currency when your economy fundamental is poor.

USD, SGD never need a weak currency to drive their economy.

Weak currency is more like poor man tool, no offence.

if 2019 m'sia bankrupt, so what's the point holding RM? guys just switch ur all saving to SGD or USD. RM is worst than RUPIAH!

Well, there you go, you don't hav to spend on transport and food in Qatar. That is where the savings come from. In MY, you have to spend on the two.

Cannot compare like that? If our wan tee mee is still RM2.50 then we would be in really deep shit already by now. You know or not Japan is trying hard to ignite inflation because deflation is far more scary.

No export increases? I guess you must be blind. When our ringgit was strong, we were having trade deficits. Since 1998, we have no trade deficit.

http://www.tradingeconomics.com/embed/?s=m...alance-of-trade

AFC 97 is not about high currency valuation, but more about unsustainable economy/financial structure.

Just like a person doesn't earn enough (export), but keep on spending (import) more than earn, and keep on borrow more (issued USD denominated bond) to fund the spending.
The imbalance of trade deficit is too steep to be handled.

Using low value currency to compete just means the economy doesn't step up into next level in competing.

We don't see US or Sg intends to lower their currency to compete with others, because they don't need to.

The analogy is like Iphone, vs cheapo phone.
Iphone never will need to lower their pricing to sell their product.

But competitor between cheapo phone needs to lower price to undercut their rival so that they can have better sales, if not they will need to close shop due to poor sales.

Export will increase with lower currency, as the lower currency means your product is cheaper and undercut rival.
People love to buy from you instead rival country.

But this is a poor man tool, as example given in cheapo phone competition, and cannot rely it forever.

As keep on lower your currency, just means your kill your own people purchasing power.
What's for more export but the expense of lower purchase power?

Economy growth supposely is to increase the income of people and purchasing power.

So there must be a balance in between, cannot rely forever using low currency to compete.

US doesn't lower their currency to compete? Please read the Plaza Accord

Singapore doesn't use interest rate policy like the rest of the world. Here's a very good article on why the Singapore dollar is strong.

The Facts Of Life: Singapore’s Monetary Policy And The SGD Exchange Rate

This post has been edited by Artus: Apr 30 2015, 04:00 PM

First, we nevr devalued our currencies, we cant help it when our RM dropped due to mkt forces. IN fact, recently, BNM tried to intervene to re-strengthn the RM. But this very action wil deplete our reserves - bad news agan.

After the RM droped, some industries did thrive, eg glove exports, condoms, and many others. But the exports are not substantial enuff to offset our debt problms, due to issues like 1MDB, etc,...

Job vuts only in specifc sectors - no choice.

I have already said : some export sectors did well aftr the RM dropped. Balance-of-trade would fall in our favour.

need to add masuk pocket how much..that u didn't include

The Monetary Authority of Sgp (MAS) uses the exchange rate to ctrl inflation. It is a bit technical, but what we need to be concerned with is tht MAS meets twice every year, and most of the time, they will either let the SGD appreciate gradually or hold. Seldom will the MAS want to force the SGD down.

Whn the Sgp gomen gives stimulus, it comes in the form of bank interest rates, not by printing more SGD.

I hav always said - we must always go with a currency tht has a high tendency to appreciate in the long term, not a currency tht is supposedly strong, but can go up or down vs the RM. And I cant see any better currency than the SGD.

Create more jobs for the people - everything else will fall in place after tht. All-in-all, job creation is the key to everything. Ths is what I believe in. If I run the gomen, this is the first thing I will do.

$onglap somewhere