Sunday, January 1, 2012

Happy New Year 2012!

In one year and out the other!  Hope you had a good one.  Time once again to check the value of relative currencies against the U.S. dollar, courtesy of The Economist and their Big Mac Index - a surprisingly accurate index based on the average price of a Big Mac in various countries around the world.  As you can see, the Canadian Loonie is slightly over-valued, as is my favourite target these days - the Euro, soon to be known as the former Euro.  The best strategy for 2012 would seem to be "sell the Euro, buy the Yuan".  The good people at The Economist point out, however, that - if adjusted for each country's GDP - the Yuan is actually slightly over-valued while the Brazilian Real is the most over-valued currency in the world.  What about the Euro when GDP-adjusted?  Still over-valued - and proverbial toast in my books.  Check out the original article here.