best currencies to invest
Currency markets in the first half of 2013 have been roiled by central bankers' delusional efforts to prop up their lackluster economies.
That means the best currencies to invest in for 2013 - or, the remainder of the year - will be in Asia and Canada - countries where the governments have refused to engage in debasing their currencies in a "race to the bottom."
Fact is, the strength of any currency is strongly related to decisions made by governments and central banks.
So knowing the best currencies to invest in this year can help protect against our government's spendthrift policies.
How to Profit From the Currency War
If you want to know how to profit from the currency war, just look to Japan.
That's because Japan's aggressive move to cheapen the yen in order to stimulate its own economy is working.
Of course, Money Morning's Chief Investment Strategist Keith Fitz-Gerald predicted this would happen months ago, and he was dead on.
But even if you missed the first moves in this currency war, it's not too late to profit.
To hear Keith explain how investors can still take advantage of the "race to the bottom" and profit from the global currency war, click here.
Why Your Financial Future Will Be Built Upon the Chinese Yuan
If you have any illusions, put them aside now. It's the Yuan's world - the West is just living in it, or borrowing from it as the case may be.
Demand for the Yuan is growing at such a staggering rate that your financial future will be built upon it.
Admittedly, this is a very tough concept for most people to wrap their minds around. It's tough to lose "your" spot at the top and it's even tougher to know you're losing it and not be able to do anything about it because the leaders who are responsible for maintaining that position don't understand the end game.
It's made worse by Washington's insistence that the dollar is still a weapon when large swathes of the world now believe it's a liability. It's exacerbated by Europeans who forget that a sound currency actually requires underlying economic stability. It's threatened by the latest crop of Japanese bankers who seem determined to print money into oblivion.
Sadly, this is not new. The old guard always fights for the status quo when something different or not well understood like the Yuan comes onto the scene.
Is Japan About to Fire the First Shots in a 1930s Style Currency War?
Chances are you've heard about the so-called "race to the bottom" in which various industrialized nations are gradually allowing their currencies to depreciate in an attempt to maintain competitive parity.
Forget about it...the real risk right now is an all-out 1930s-style currency war. I know it's not front-page news yet, but I have a sneaking suspicion it will be shortly.
It's going to blindside Washington and most of Europe, where central bankers, politicians, and more than a few economists fail to recognize that events from nearly 100 years ago are now primed to repeat themselves.
Worse, it will devastate an entire class of investors who have put their faith in the current economic dogma of endless bailouts and money printing.
Ironically, this currency war won't start because of international problems. Instead, it will be touched off in earnest because of domestic concerns-- only they aren't ours. My guess is Japan fires the first shots.
- Japan's newly elected Prime Minister, Shinzo Abe, is calling for unlimited stimulus and more aggressive financial intervention in an effort to boost Japan's flagging economic situation and eviscerated domestic economy.
- The Bank of Japan has doubled its inflation target to 2% while also promising to buy unlimited assets using a page from Bernanke's playbook. Bear in mind that Japan's combined private, corporate and public debt is already nearly 500% of GDP, which is much larger than the 250% that's commonly bandied about in the media.
- Japan has one of the strongest fiat currencies on the planet, which means it has the most to gain and everything to lose if somebody beats them to the punch. An expensive yen holds back Japan's exports by making them more expensive in global markets, while the debt I just mentioned hobbles future economic development by robbing the private sector of capital it needs for an actual recovery.