Foreign reserve will definitely run out in long term?
binocular222 asked: Let’s talk about foreign currency inflow-outflow at developing countries:
FDI,FPI: When foreign investor invest in a country, they expect to earn more than what they paid which means in long term, when they withdraw principal+profit => foreign currency OUTFLOW is greater INFLOW
Loan (commercial loan, ODA, IMF, WB…): In long term debtor has to pay [...]
The Fed engages in FX trading? What?
Zowzooma, the Angry Deity asked: My book says this: “Had foreigners not wanted to use their dollars to buy investments in the United States, our government would have been forced to draw down its official reserves and use its holdings of foreign currencies to trade for al the dollars that foreigners held.”
I’m not doubting [...]
Currency Exchange Question?
TheRaven asked: I am a little confused with an aspect of foreign currency trading. Today, for 1 US Dollar you would get roughly .50 cents in British currency and for 1 British Pound, you could get almost 2 Dollars US. Does this mean that if the British were to come here, they would actually be [...]
What mechanism have national governments used to protect their economies and industries from foreign competiti?
Jay asked: What mechanism have national governments used to protect their economies and industries from foreign competition?
a)Import tariffs
b)Free trade blocs
c)Increasing the value of their currency
d)Anti-trust laws
Not wanting to commit to fixed exchange rates, some govts occasionally use foreign currency intervention?
kimbocamp asked: to affect the value of their currencies. This is known as a managed flexible exchange rate system, or managed float, because it combines fixed and flexible exchange rates.
The diagram below shows the market for euros, where the exchange rate is defined as U.S. dollars per euro. Suppose that the central bank for the [...]