Precisely.....
As Dan Burton said to me, paraphrasing: "If you believe that currency adjustments are going to wipe out this difference, then you've got to believe that price theory is meaningless, and that the trade tail will wag the dog of all dollar denominated assets in the world."
I hope I did his words justice.
"As Dan Burton said to me, paraphrasing: 'If you believe that currency adjustments are going to wipe out this difference, then you've got to believe that price theory is meaningless, and that the trade tail will wag the dog of all dollar denominated assets in the world.'
I hope I did his words justice."
That is pretty close to what he said in his testimony before the tax commission. If the SQLs really thouht that would happen, then it would create an enrmous wealth effect for every one holding dollar denominated assets. That would completely offset the concerns of retirees protesting about paying a little more for their tiolet paper, milk and shave cream. However, you never hear them say that.
Of course, US equities would increase substantially in value, but not because of currency translation.