Your Questions About Money Making Stocks For 2011

Joseph asks…

What factors will change the exchange rate (Euros to Canadian Dollars)?

Hi Folks,

Before I even begin, I’d like to apologise for my ignorance on the subject of stocks, shares, exchange rates, etc. It’s just never been relevant to me before….UNTIL NOW!

I am hoping to sell my home in Spain and send any profits to Canada where I now live permanently.

I have been looking at the exchange rate from Euros to CAD on a daily basis to get an idea of what the amount will look like in Canadian Dollars.

Today, for example, was 1.36 (1 euro is 1,36 CAD). On 23rd August 2011 it was 1.42744 (better rate) and on 29th December 2008 it was 1.7244 (wow!).

It makes me cringe when I see that the current rate is much lower than it has been in the past. The amount of money would probably be around 60,000 euros so even a small rate change would make a difference. I have an option of sending the Euros to the Scotiabank in Canada where they allow Euro accounts and then wait for the rate to improve. I’m not in any immediate rush to change into CAD so this could be my best option.

Anyway, my question is – What kind of factors may help improve the EURO to CAD rate to my advantage. It would be nice to think that it’s worth waiting for the rate to improve if I knew that there was a good chance things would get better.

Any comments/advice would be fab.

Thanks so much.

John answers:

Well, there are six most common Factors That Influence Exchange Rates

Differentials in Inflation
Differentials in Interest Rates
Current-Account Deficits
Public Debt
Terms of Trade
Political Stability and Economic Performance

What I suggest is to study all these factors for the currencies you want to exchange and try to reach some conclusion by yourself.

The exchange rate of the currency in which a portfolio holds the bulk of its investments determines that portfolio’s real return. A declining exchange rate obviously decreases the purchasing power of income and capital gains derived from any returns.

Best of Luck

James asks…

Do you feel pleased when Christmas is over?

When I was a child I loved Christmas. I loved Christmas because it was a time for keeping each other warm, trying out different foods and very few presents.

My main present one year was a doll from Dad, a new outfit from mum and my stocking or sock would be filled to the brim with nuts, fruit, figs, dates, and sweets. Fantastic.

In another year my father bought me a watch and my mum a book and again my sock or stocking was filled with the above.

I thought this was heaven receiving so few things. My parents both worked my mum was a cleaner and my Dad an Upholsterer. I suppose they may have been able to buy more but something else would have been neglected to do that. For instance a bill and in those days – if you failed to pay your bills no compassion was shown to families with children. The gas or the electric could easily be disconnected.

I also remember other children in school telling me in the new year of all their presents. Some children really did tell tall tales.

Today I find Christmas very stressful and because I’m on a budget as far as spending is concerned, I only buy what I think I should get for others. Recently though, I was informed someone had bought me some expensive things for Christmas so I was made to feel that I should have bought more. My response was this I am doing the best I can, considering my lack of finances.

I explained the situation that it will be March before my little Christmas debt is paid up and that this is the first Christmas I’ve actually gone into debt on my credit card. I hope its the last Christmas that I’ve had to go into to debt for.

I don’t like debt but there is an obvious reason for it. . The cost of utilities over the last year has cost me more and also because one of my suppliers has become confused I have had 6 months of bills within 4 months leading up to Christmas, So it will be interesting what the new year will bring forth.

All in all I have found my self stressed out of mind with worry wondering what to buy for folks so only bought a few items per person. So this years 35 gifts have all cost me from £5.00 to £19.00 each and my total debt is approximately £300. Thing is because all of my friends are into consumerism its almost expected that I should be to. There is no consideration about whether you can afford Christmas in the first place.

So I’m afraid that I’m always pleased when it’s over and I can get my home back to normal. Today is classed as the 6th day of Christmas but because everything takes place on the 25th the first day of Christmas, I often ask myself whether all the hassle, the queues, the spending is worthwhile.

I also feel quite annoyed at the plethora of gifts given to children who smile for five minutes when opening them and play with their gifts for another five minutes and then they are bored. Back to the DS games and consoles with no conversation for adults in the room.

A few months down the line and the said same gifts will be landing in a charity shop with a few making it to a car boot sale.Sold or given away at laughable prices. When this happens it means we don’t need these gifts. We don’t need to be wasting money buying them. Yet every year it happens.

I would love todays’ children to have Christmas the way I had Christmas. Then whatever is given to them might be gratefully received and treasured.

I have made my mind up, I feel so fed up with Christmas 2011, 2012 is one I will cancel from my calendar unless its a break away from it all.

Do you feel the same?

John answers:

I totally agree with you. When I was a child we didn’t have much to spend on Christmas presents, but despite that I recall many happy days. What I really recall is not the presents, but the gathering around to play games and make jigsaw puzzles together. I think that is the real spirit of Christmas right there, and not all the consumerism that goes on today.

Due to a very tight budget; my friends and I came to an agreement this year to limit the presents to one each. It worked really well and I am going to do even better next Christmas, by making the presents myself. For example: I am going to do a cross stitch picture of my friend’s favourite flowers; and do a photo calendar of another friend’s children in action. If I plan it right, both will come as totally unexpected surprises that will bring a smile to their faces.

Maybe you could get your kids to do something along those lines for their friends and relatives. It is amazing what kids are able to do with computers and mobile phones these days. The effort that they put into doing things like that will make them more aware of the value of spending time doing things for to make others happy.

Ken asks…

Why do central banks like inflation, is this man right about?

The final option, which is to inflate away the debts, looks to be the easiest of the three options. By having higher inflation while the nominal value of debt doesn’t change, the real value of the debt falls, making it easier to pay back over time. Extremely high inflation will obviously cause major problems, but inflation rates in the range of 7-10% would not be as bad. It is easy to implement as central banks can create money, and it helps the debt situation over time.

Thus, central banks want higher inflation. The reason they are happy to create more monetary stimulus anytime the markets are doing poorly is that they are not worried if inflation goes up. Higher inflation punishes savers in the economy, but it does partly alleviate the debt problems. Furthermore, it won’t create a financial crisis or panic. In fact, stock markets do well when there is additional cash in the system.

The most likely outcome of the debt problems in Western economies is higher inflation. It is not necessarily the best option from an economic perspective, but it is the easiest to implement and the effects are spread out over a long period of time. Central banks know this, and thus are happy to continue monetary stimulus as long as they feel is necessary.

When a country is faced with excessive levels of debt, they have essentially three options. First, they can pay it back. Second, they can default. And third, they can inflate it away. We’ll discuss the pros and cons of each, and see that the inflation option is probably better than the first two.

For a country to pay back its debts, it would need to see significant spending cuts and tax increases. This is already occurring, though not nearly to the extent that is necessary. This is in theory is the correct option, though from a political perspective it is not easy. Large cuts in government expenditure and tax increases can lead to a short-term recession and social unrest. For this reason, it is difficult to implement.
Do Central Banks Want Higher Inflation- By Asad Dossani, Author, The Lucrative Derivative Report

Wouldn’t it be better if EVERYONE just payed the same rate in taxes, you know equality and fairness ???
Your wrong mark I’m not a tea-bagger, why would you even think that, the tea partyiers did not support tax increase, I am for everyone….to make it fair and equal. How hard is that to understand. What the tea partyiers wanted was the cake and eat it too. I do not support that and know how to compromise. You can’t expect to be at war, pour debt out like wildfire to cover it and not expect tax increases, instead we printed more money and poured out as stimulus, that most all Conservatives did not agree with…This is what I do not understand about Tea Baggers, you can’t have it all without giving something, all I think is tax rates should be fair/equal to all and I also think they are the idiots who are holding this hostage, most of them are most likely in the 150,00 to 350,000…and from what I hear they are the ones that are crying the loudest. I would be just easier if everyone paid a fair rate of tax.

John answers:

Banks like inflation coupled with people in debt.

When a person buys things on credit, they have to pay interest on the debt they incur.
The interest is always higher than the inflation.
As inflation increases, living costs increase.
As living costs increase, people borrow more money.
People borrowing more money means people are racking-up more debt.

Betty asks…

Do you think i am good enough to get a small bmx sponsor?

I am 14 years old i live in michigan and i ride a 2011 verde eon some stock parts but not many.I have been riding for 3 months and i have picked up alot of tricks.I like to ride street more than park.i can do 180 fakies,360 fakies,360 tire taps,3 flat,tire grabs,toejams,toejam tailwhips,ets,grinds and stalls,180 tire grabs,i can almost tailwhip flat and im am working on barspins and i can land tuck nohanders sometimes when i dont get scared.I will ride for anyone at this point i just wanna get my name out i make videos i love to edit them and i will ride for free or money i don’t really care.Someone please help me get a small sponsor

John answers:

You get sponsored by entering competitions and winning. I don’t know why everyone that has a BMX bike thinks they can get a sponsor just by asking.

Sandra asks…

is it possible to install quad exhaust on a 2001 jetta tdi?

i have a 2001 jetta tdi and i saw that they have only one rear exit, like the stock exhaust. what i want to know if its possible to have 2 exits with with quad exhaust like the bmw m3 series likes this –>

rear exhaust, muffler tips:
stock: (oo) on the left side custom: (oo)====(oo) both left and right sides

im a big fan of quads and i find them to look very appealing and sexy on a bmw m3 so i wanted to see if i can do the same on my 2001 jetta to make it look very sporty, this car was past down to me but i love the newer models such as the cars of this these yrs 2010,2011,2012 but unfortunately theres no money, also ive done alot of reaserch but i couldnt find my answer so i wanted to see if anyone can atleast tell me that i can but i just need new pipes for the exhaust system.

again just to recap just look at the bm3 m3 2011 model and it has quad exhaust, or just like the vw golf. i hope theres an answer, and if there is can anyone please explain to me how i could do this, it will be extremly appreciated.

thank you

John answers:

If you want to split the exhaust after the cat it shouldn’t be a problem, find the pipe(s) you want and talk to muffler shop about mounting them, do that before you buy them, should not be to hard

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