Posted on 09/04/2014 4:16:23 PM PDT by dontreadthis
Imagine this scene:
Everyone in the country was in shock. Peoples net worth had devalued more than 53% overnight.
The value in savings accounts dropped in half and neither merchants nor consumers knew how to react because they had never been through something like it before This is how an American business executive described living through Mexicos devaluation of the peso exactly 38 years ago on September 1, 1976.
Looking back, it was so obvious.
Mexico had a mounting debt, destructive policies, and a woefully unsustainable fixed exchange rate with the US dollar. All the writing was on the wall.
But most people ignored the warning signs and kept their money in pesos.
Mexican President Luis Echevarria even went out on the radio to reassure people that the currency was safe.
Finally, under intense fiscal pressure, the government reached its breaking point. And on August 31, 1976, they made the decision to devalue the peso.
People woke up the next morning on September 1st to a 50%+ decline.
(Excerpt) Read more at zerohedge.com ...
I remember that, I had bought some shares of Mexican Walmart and a month later it was worth half what I paid. It came back somewhat and I sold.
My father who was never very good at making money wanted to buy Pesos after that. It has never recovered and while it was 10 to 1 for years I see it is now 13.15 to 1.
That's about right for a divorce where the opposing side has bad counsel and they have NO clue where assets are.
/johnny
/johnny
This is why governments should NEVER have the power to print money or modify the value of a currency in any way. Accepted currency should be in whatever the market wants, but there doesn’t necessarily need to be one universal currency. I’d love to live in a world where we have gold, silver, Bitcoin, Litecoin, Dogecoin, and several other money values as universally accepted currency, as it would make it nearly impossible for the greedy Feds to tax and inflate.
Not exactly.
The problems in the economy had developed over a number of years. The devaluation exposed the pre-existing loss of value more than it created it.
How is this accomplished?
I knew a guy who worked where I was working at the time who traveled to Mexico about 5 times a year. He had family there. This was maybe 2002. I asked him about buying Onzas (Libertad) coins, which are one ounce Mexican silver coins. He said there were guys selling bucketloads of them a few blocks from where he used to stay, at his relatives home In Mexico City. They were about $6.
So I started giving him $200 at a time to buy and bring back the coins. You cannot import more than 25 (maybe 20) at a time without declaring them.
First time: “oops, I forgot”
second time: “oops, I forgot”
third “oops, I forgot” “
fourth “ “ “ “
fifth: “ “ “ (oh and they’re more like $7 now.
sixth: “oops”
seventh: Now they want $8 each.......
15th time: “Hey, they’re all gone”
never got one.
I have no idea what the name is, and can barely read enough russian to see that they were issued by a bank. Who knows? They are real silver, and maybe have a slightly higher radiation count than background radiation here.
I'm happy with them. ;)
/johnny
Saw this post at source...thought you might be interested [the Clintons bailed out Mexico??]:
“For further reading on the history of money and esp the secret Bailout by Clinton and the Fed of Mexico [to save NYC bankers on the backs of Merikan peeples] read the Secret World of Money by Andrew Gause:
http://www.amazon.com/Secret-World-Money-Andrew-Gause/dp/0965658902/ref=...
It’s a thin booklet you can read in one day but a wealth of very readable info and facts you will never forget.”
You know, Echeverria was a CIA asset.
A currency cannot stay high without a large manufacturing base (not counting American-”based” manufacturing on foreign soil).
What, then, is the explanation for the swiss franc and the HK dollar?
Thanks. More serious reading on the Clintons, the banksters and Russia
https://solari.com/blog/anne-williamson-testimony/
Thanks to zero hedge poster, booboo (2nd post)
http://www.zerohedge.com/news/2014-09-03/death-knell-european-union-1-chart#comments
“This is why governments should NEVER have the power to print money “
Actually ours doesn’t. It’s right there in the Constitution. But they do it anyway.
Would a hard currency fund work?
IIRC, it says the States can not make anything but gold or silver money.
As I recall, the Mexican bailout was $50 billion dollars that was taken from a very secret fund that was intended to bolster the American dollar. When the news hit, even economist was saying they were unaware of the secret rainy day fund.
Thanks. You are a wealth of info ;-)
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