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dairyairy
Joined: 17 May 2012
Location: South Korea
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 Posted: Wed Jun 06, 2012 4:07 pm Post subject: |
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| tideout wrote: |
| dairyairy wrote: |
| It seems to be leveling off for the time being. |
Yeah, it seems like it was leveled out for a time period in the 1130-1140 range and it's got a new lower plateau of sorts.
Last year this time it had climbed in value but this does look like a very different year. |
It also has something to do with computerized trading and how the upper and lower parameters are set and reset. That's why they were so afraid of the won dropping below the 1200 mark because the computers would then reset to 1200 as the new high and it would take a monumental effort by the Korean government to get it back above 1200. |
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tideout
Joined: 12 Dec 2010
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| Posted: Wed Jun 06, 2012 4:54 pm Post subject: |
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| dairyairy wrote: |
| tideout wrote: |
| dairyairy wrote: |
| It seems to be leveling off for the time being. |
Yeah, it seems like it was leveled out for a time period in the 1130-1140 range and it's got a new lower plateau of sorts.
Last year this time it had climbed in value but this does look like a very different year. |
It also has something to do with computerized trading and how the upper and lower parameters are set and reset. That's why they were so afraid of the won dropping below the 1200 mark because the computers would then reset to 1200 as the new high and it would take a monumental effort by the Korean government to get it back above 1200. |
Interesting addition to the discussion. I don't follow a lot of the details of trading etc. but what you're saying makes a lot of sense. It definitely looks controlled within a given range. Nice to know it's not just my vivid imagination.  |
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sml7285
Joined: 26 Apr 2012
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| Posted: Wed Jun 06, 2012 6:00 pm Post subject: |
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| dairyairy wrote: |
| tideout wrote: |
| dairyairy wrote: |
| It seems to be leveling off for the time being. |
Yeah, it seems like it was leveled out for a time period in the 1130-1140 range and it's got a new lower plateau of sorts.
Last year this time it had climbed in value but this does look like a very different year. |
It also has something to do with computerized trading and how the upper and lower parameters are set and reset. That's why they were so afraid of the won dropping below the 1200 mark because the computers would then reset to 1200 as the new high and it would take a monumental effort by the Korean government to get it back above 1200. |
If I remember correctly, any change in parameters requires several days of trading at a certain level. Honestly, it's a perfect storm for the Won. The US is riding high due to it regaining its status as the only secure holding currency and the Won is plummeting due to oil issues with Iran. |
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tideout
Joined: 12 Dec 2010
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| Posted: Wed Jun 06, 2012 7:48 pm Post subject: |
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| sml7285 wrote: |
| dairyairy wrote: |
| tideout wrote: |
| dairyairy wrote: |
| It seems to be leveling off for the time being. |
Yeah, it seems like it was leveled out for a time period in the 1130-1140 range and it's got a new lower plateau of sorts.
Last year this time it had climbed in value but this does look like a very different year. |
It also has something to do with computerized trading and how the upper and lower parameters are set and reset. That's why they were so afraid of the won dropping below the 1200 mark because the computers would then reset to 1200 as the new high and it would take a monumental effort by the Korean government to get it back above 1200. |
If I remember correctly, any change in parameters requires several days of trading at a certain level. Honestly, it's a perfect storm for the Won. The US is riding high due to it regaining its status as the only secure holding currency and the Won is plummeting due to oil issues with Iran. |
FWIW, I don't have any strong opinions on it but I'm a little perplexed by the occasional posts on "oil" being a major factor w/ the Won. Oil's down about 15% from last year and I think it was just a few days ago that Iraq is actually starting to come on line. With the slowing economy in China I'd think oil costs/availability would not be such a strong factor?
My ongoing opinion is that the Euro issues and the continuing-to-be-mediocre US economy drags the Won down (export worries) and boosts the "value" of the $ relative to the other messes. |
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northway
Joined: 05 Jul 2010
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| Posted: Wed Jun 06, 2012 7:55 pm Post subject: |
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| tideout wrote: |
FWIW, I don't have any strong opinions on it but I'm a little perplexed by the occasional posts on "oil" being a major factor w/ the Won. Oil's down about 15% from last year and I think it was just a few days ago that Iraq is actually starting to come on line. With the slowing economy in China I'd think oil costs/availability would not be such a strong factor?
My ongoing opinion is that the Euro issues and the continuing-to-be-mediocre US economy drags the Won down (export worries) and boosts the "value" of the $ relative to the other messes. |
I'm no expert, but the US doesn't depend on Iranian oil at all, whereas Korea does, and with sanctions going into effect this week such dependence can't help. This doesn't negate the other issues you cite, but it may be working in concert with them. |
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atwood
Joined: 26 Dec 2009
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| Posted: Wed Jun 06, 2012 8:41 pm Post subject: |
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| northway wrote: |
| tideout wrote: |
FWIW, I don't have any strong opinions on it but I'm a little perplexed by the occasional posts on "oil" being a major factor w/ the Won. Oil's down about 15% from last year and I think it was just a few days ago that Iraq is actually starting to come on line. With the slowing economy in China I'd think oil costs/availability would not be such a strong factor?
My ongoing opinion is that the Euro issues and the continuing-to-be-mediocre US economy drags the Won down (export worries) and boosts the "value" of the $ relative to the other messes. |
I'm no expert, but the US doesn't depend on Iranian oil at all, whereas Korea does, and with sanctions going into effect this week such dependence can't help. This doesn't negate the other issues you cite, but it may be working in concert with them. |
SK was looking into ways to skirt the sanctions with Iran. The big problem seemed to be getting insurance for the tankers.
But oil is priced in dollars, so a strong dollar makes it more expensive for Korea. |
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tideout
Joined: 12 Dec 2010
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| Posted: Wed Jun 06, 2012 9:31 pm Post subject: |
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Interesting. I'd forgotten the sanctions were going in effect this week. I vaguely remember some talk on the net about "exemptions" being granted but I didn't really follow the story.
A lot of things going on all at once....difficult environment to be making predictions in. |
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sojusucks
Joined: 31 May 2008
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| Posted: Fri Jun 22, 2012 4:25 pm Post subject: |
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http://blogs.wsj.com/korearealtime/2012/06/21/korea-still-an-emerging-market-whatever/
South Korea's status as an "emerging market" is preventing larger external investors from moving into the Korean stock market.
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For financial markets, an upgrade could have meant a surge of money into Korea as fund managers who track indexes such as MSCI�s shift allocations.
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So, what's the problem?
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MSCI says the major obstacles to an upgrade for Korea are a lack of local currency convertibility and cumbersome registration requirements for foreign investors. The prospects of a resolution of these issues in the near-term look slim, primarily because they are bound up in bigger macro-economic policy matters handled by the government.
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Because Korea extends that "all waygookin are bad" attitude to everything, including investing, their investment structure is stuck in neutral. It makes you wonder how many investors wanted to put money into the Korean exchange but were turned off by that ugliness. |
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tideout
Joined: 12 Dec 2010
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| Posted: Fri Jun 22, 2012 5:19 pm Post subject: |
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| sojusucks wrote: |
http://blogs.wsj.com/korearealtime/2012/06/21/korea-still-an-emerging-market-whatever/
South Korea's status as an "emerging market" is preventing larger external investors from moving into the Korean stock market.
| Quote: |
For financial markets, an upgrade could have meant a surge of money into Korea as fund managers who track indexes such as MSCI�s shift allocations.
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So, what's the problem?
| Quote: |
MSCI says the major obstacles to an upgrade for Korea are a lack of local currency convertibility and cumbersome registration requirements for foreign investors. The prospects of a resolution of these issues in the near-term look slim, primarily because they are bound up in bigger macro-economic policy matters handled by the government.
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Because Korea extends that "all waygookin are bad" attitude to everything, including investing, their investment structure is stuck in neutral. It makes you wonder how many investors wanted to put money into the Korean exchange but were turned off by that ugliness. |
Sorry I don't have the link directly, but there was a fairly perturbed sounding interview with an exec from the Lone star group out of Texas in an issue of BusinessWeek some months back on investing in Korea.
Basically, Lonestar saved KEB from financial disaster only to be "bank blocked" later when they wanted to extract some of their earnings. I believe the case went all the way to the Korean Supreme Court.
The riff from the CEO was basically warning other businesses about investing/doing business in Korea. He mentions legal, cultural and I think, even emotional trauma to doing business here.
The article ties this story in with the low ranking of SK for investors. I believe it ranked 10th in Asia for investments.
*disclaimer
I'm recounting the above from a few months back but the basic outline is accurate! |
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