Korean Job Discussion Forums

Kiwi Tart · Joined: 17 Jul 2006 Location: Seoul

When I came here in May the won was stronger than the US dollar... now I'm looking to send money home, and shocked at the value...
When did this happen? More importantly, when's it going to go back up?(Magic 8 ball time, I'm sure...but, can't blame a me for asking.)

losing_touch · Joined: 26 Jun 2008 Location: Ulsan - I think!

Exchange rates often fluctuate. There is no comprehensive or accurate model to predict future exchange rates. No model has been more effective over the long term than the random walk. You could spend your time looking into things like interest rate parity, but at the end of the day it might not help you too much. With the financial markets in a state of disarray, what will happen next is unknown. Read about Lehman and Merrill Lynch. Then read about Fannie Mae and Freddie Mac. Decide for yourself.

jadarite · Posted: Tue Sep 16, 2008 9:36 am Post subject:

I honestly don't know what I am talking about. But here goes. I went to Yahoo and looked up 5 year history between Korean won to US dollar. It appears that the worst time was in winter of 2003. Does this mean the Korean won is stronger or the US dollar is just getting weaker?

They seem to be saying both at http://www.forexblog.org/2007/10/korean-won-bene.html

Now for someone who seems to know what they are talking about, http://world.kbs.co.kr/english/economynit/econit_issue_detail.htm?No=1356

Here's a graph http://forecast-chart.com/exchange-korean-won.html

If that small dip at the end is any sign, hang in there. On a brighter note, this might be a good time to send money to Korea.

FORECAST: August, 2009 - 986 won http://forecast-chart.com/usd-korean-won.html

hari seldon · Joined: 05 Dec 2004 Location: Incheon

Juregen · Joined: 30 May 2006

Americans are selling their non-American assets to stop the bleeding in America, this causes the dollar to appreciate in an abnormal way.

Once this panic reaction stops and America paid of it's debts .... might foreign exchange market stabilize.

ytuque · Joined: 29 Jan 2008 Location: I drink therefore I am!

laconic2 · Joined: 23 May 2005 Location: Wonderful World of ESL

As long as inflation continues to grow as an increasingly larger elephant in the room factor, I don't see the Federal Reserve lowering interest rates.

Tobias · Joined: 02 Jun 2008

[quote="ytuque"]...There are a countless reasons why the Korean won is the worst performing Asian currency this year.

If you want to educate yourself on financial matters, this is the last website that you want to be reading. Try cnbc or bloomberg for videos and articles. As for currency exchange forecasting, I have noticed that Goldman Sachs has really done a good job of predicting movements in various currencies.

BTW my prediction is: Overall, the won may weaken further from here. However, the Federal Reserve may lower interest rates which will put downward pressure on the dollar, and the Korean goverment may sell dollars to support the won and raise interest rates to fight inflation. Expect to see volatility in the dollar-won rate, so if you need to send money out of the country, you can pick a good point to move your money.

I should also mention that there is what has been called a "doomsday scenario" for the Korean won. Foreigners hold over $200 Billion in Korean debt which expires this year. If the foreigners repatriate that money, they will be selling won and buying other currencies, such as the dollar. There is a small possibility that the won could drop significantly here. Overall, I would prefer to hold dollars to won.[/quote]

Thanks for info, Y. Especially the heads-up on the doomsday plan. You learn something new everyday here, it seems.

As goes the US economy, so goes the Korean economy, after a lag period. The US is still the world's consumer engine, and it makes export-oriented economies such as the Little Tiger Korea see such economic success. It's been called a "miracle", the rise in Korea's SOL. I don't believe in miracles myself, and with the American Joe cutting back on his consumer activities, I'd say the won will be taking a beating over the next, say, 18 months. If we see Korea's economic doomsday scenario played out, expect to see the won at 1800-2000 in about 8 months. But that's worst-case.

cedarseoul · Joined: 16 Feb 2008 Location: nowon-gu

ytuque · Joined: 29 Jan 2008 Location: I drink therefore I am!

Overseas markets jumped on a technical rebound as well as the news of the AIG deal in the US. The Korean government also sold dollars and bought won today to support the won. This won pump may last for a few days before the downtrend likely continues.

Paddycakes · Joined: 05 May 2003 Location: Seoul

Join Me · Joined: 14 Jan 2008

Bad news from the US hurts the exchange rate between the won and the dollar. Good news helps it. You don't need a crystal ball to figure out 1/20/2009 is going to be the day you want to scurry off to the bank to swap your won for dollars. That is as long as King George doesn't find some way to rig the outcome of this election in a way that will allow him to continue on his personal quest to bankrupt America.

Adventurer · Joined: 28 Jan 2006

spliff · Joined: 19 Jan 2004 Location: Khon Kaen, Thailand

It'll be back in the dumper today i would imagine due to last nights US stock market fall. Evil or Very Mad

Tobias · Joined: 02 Jun 2008

[quote="Paddycakes"]
Is it just me or is the stock market totally on crack these days?[/quote]

A lot of people are attached to the stock market's umbilical, so they must jump on minor perturbations. Have no doubt, if these people could get out and not take a beating, they would.

If you listen to the press's spiel, you'll think the economy is purring along. That's what you are meant to think. The truth is the world's economies are on the brink of a downturn. As usual, media elites like Rupert Murdoch are keeping the truth from us common schmucks.