What’s almost as good as a pay raise? When your salary is a constant C in yen, and the exchange rate is hovering at 115-120 yen per dollar… and then the exchange rate plummets below 100 yen per dollar. Effectively my salary is up 15%.
The question is, do I trade now, or do I wait for it to sink further? If I trade now I’ll make about 2500 dollars over a couple weeks ago. Historically after the rate drops sharply it slowly increases over the next month or so as people make their trades to equilibrium. But if I trade and it drops again sharply I’ll be kicking myself. And it’s still falling.
Incidentally, this means my expenditures within Singapore just got a lot cheaper, since their dollar seems to be closely linked to ours. Very interesting.
We just faced the same thing selling that house. Prices are dropping, so do we take this offer or wait? Don’t you wish you had a time machine? Well, maybe not!
It was at 96.88 yen to the dollar on March 17th. It’s back up a bit now though.