The dollar is the source of Problem

[Solomon2]

Everyone knows that "Futures" price can be manipulated by buying and /or selling large number of contracts is a short space of time. Less liquid the exchange (not many buyers / sellers) more prone to manipulation is the market...If & when Bolsa Mexican becomes so liquid, traders would start using its quotes as well and would use Mexican pesos. Do you see that happening any time in the foreseeable future?

No, I don't. I suppose you are right: while Mexico may produce and sell enough oil to justify the futures contract, the overwhelming presence of PEMEX plus Mexico's reputation for corruption would make the assumption of manipulation you've mentioned a "given" in the opinion of prospective traders.

 

[niaz]

poor export performance? POOR? are you sure? like US have such a remarkable export performance vis a vis import or any other developed country have such a great export performance. I say pakistan have more export performance then most of the so called developed countries.

PROBLEM IS PAKISTAN CURRENCY IS ARTIFICIALLY KEPT LOW. WHAT COUNTRIES DO IS BUY OUR PRODUCTS USUALLY CLOTHES IN DIRT CHEAP PRICES AND SELL IN HIGH PRICE IN THERE COUNTRY.

I am no fan of barter trade but bring back the gold standard.

Hon Sir,

When I came to study in UK in 1962, one US Dollar was equal to 4.76 Rupees. Pak currency was decimalised in 1961 and we had a coin for one new paisa called ‘teddy paisa’ which was equal to 1 /100 of the rupee. One Rupee was then a bank note (one 'Tola' sliver alloy coin before that). Last year I visited Karachi and found that one rupee coin was barely bigger than one teddy paisa coin of the 1960’s.

To me, real value of the currency is equal to value of metal in it. In my opinion Pak Rupee coin is certainly not larger than one Cent coin of the US currency, hence about 100 Rupee to a Dollar is just about right. I admit that I am ignorant person; would greatly appreciate if you could kindly explain how did you come to the conclusion that Pak Rupee is artificially undervalued and what should be the real value of Pak Rupee?

Regarding the cheap price of Pakistani clothes, I have an old classmate who is an international fabrics trader. He maintains that the Bangla Deshi fabrics are often cheaper and of better quality.

Bangla Desh exported $28.5-billion of textiles in 2015 and was the 5th largest in the world.

https://www.adamrossfabrics.co.uk/2015/10/28/biggest-textile-exporters-in-the-world/

On the other hand Pakistani textile exports are around $12 to 13-billion. Don’t you think that the reason for this could be either Pak textile & fabrics are too expensive or of lesser quality or possibly both?

 

[bananarepublic]

Hon Sir,

When I came to study in UK in 1962, one US Dollar was equal to 4.76 Rupees. Pak currency was decimalised in 1961 and we had a coin for one new paisa called ‘teddy paisa’ which was equal to 1 /100 of the rupee. One Rupee was then a bank note (one 'Tola' sliver alloy coin before that). Last year I visited Karachi and found that one rupee coin was barely bigger than one teddy paisa coin of the 1960’s.

I admit that I am ignorant person; would greatly appreciate if you could kindly explain how did you come to the conclusion that Pak Rupee is artificially undervalued and what should be the real value of Pak Rupee?

To me, real value of the currency is equal to value of metal in it. In my opinion Pak Rupee coin is certainly not larger than one Cent coin of the US currency, hence about 100 Rupee to a Dollar is just about right.

Regarding the cheap price of Pakistani clothes, I have and old classmate who is an international fabrics trader. He maintains that the Bangla Deshi fabrics are often cheaper and of better quality.

Bangla Desh exported $28.5-billion of textiles in 2015 and was the 5th largest in the world.

https://www.adamrossfabrics.co.uk/2015/10/28/biggest-textile-exporters-in-the-world/

On the other hand Pakistani textile exports are around $12 to 13-billion. Don’t you think that the reason for this could be either Pak textile & fabrics are too expensive or of lesser quality or possibly both?

I believe the bulk of Pakistani fabric is of very low quality not much value addition is done plus the whole textile sector hasn't seen a wide scale reform . there is also the factor of higher wages and expensive electricity. While the bulk of high quality branded fabrics are now being sold locally i.e khadi etc..
I believe that Pakistan has to move from an agri economy to a more industrial derived economy but seeing the current political environment with retarded leader who have no vision nor the intention of and economic overhaul the future looks bleak for us .
And those who say CPEC will magically fix that remember that change cannot come from the outside it can only facilitate our growth.

 

[Nilgiri]

On the other hand Pakistani textile exports are around $12 to 13-billion. Don’t you think that the reason for this could be either Pak textile & fabrics are too expensive or of lesser quality or possibly both?

There is a LDC tariff advantage in Europe for BD that Pakistan does not have. Its a factor (when comparing the two)...but still Pakistan should do a lot better (India same thing btw), if you look at how much RMG China is still exporting (I think nearly 200 billion USD a year out of 500 billion total global market last time I checked) given their wealth/capita and labour costs (even accounting for forex-induced undervaluing strategy) now. A lot lies in the logistic + business + credit costs south asian region still is burdened with....because those in power have got their grubby hands all over everything....and a small tinkering is enough to give huge perceived optics to the forces shackled.

People still dont fully get the larger systemic process faults, because they are mostly stuck in it themselves and dont have an actual reference to experience and demand real change. Thus whole region is reliant on top down "luck" (i.e enough concentrated good leadership/reform) rather than bottom up churning.

 

[mohd497]

Hon Sir,

When I came to study in UK in 1962, one US Dollar was equal to 4.76 Rupees. Pak currency was decimalised in 1961 and we had a coin for one new paisa called ‘teddy paisa’ which was equal to 1 /100 of the rupee. One Rupee was then a bank note (one 'Tola' sliver alloy coin before that). Last year I visited Karachi and found that one rupee coin was barely bigger than one teddy paisa coin of the 1960’s.

To me, real value of the currency is equal to value of metal in it. In my opinion Pak Rupee coin is certainly not larger than one Cent coin of the US currency, hence about 100 Rupee to a Dollar is just about right. I admit that I am ignorant person; would greatly appreciate if you could kindly explain how did you come to the conclusion that Pak Rupee is artificially undervalued and what should be the real value of Pak Rupee?

Regarding the cheap price of Pakistani clothes, I have an old classmate who is an international fabrics trader. He maintains that the Bangla Deshi fabrics are often cheaper and of better quality.

Bangla Desh exported $28.5-billion of textiles in 2015 and was the 5th largest in the world.

https://www.adamrossfabrics.co.uk/2015/10/28/biggest-textile-exporters-in-the-world/

On the other hand Pakistani textile exports are around $12 to 13-billion. Don’t you think that the reason for this could be either Pak textile & fabrics are too expensive or of lesser quality or possibly both?

go ahead you can make fun of me. no issues.

Can someone please tell US to depreciate their currency the very same way pakistani currency is depreciated cause IMF says so?

 

[Incog_nito]

I agree that Dollar is Kind of a Problem for Pakistanis. But, are there any Banks that are allowing people to open up accounts in Yuan currency?

 

[niaz]

go ahead you can make fun of me. no issues.

Can someone please tell US to depreciate their currency the very same way pakistani currency is depreciated cause IMF says so?

Hon Sir,

I first went to the USA in 1964, and the last visit was in 2006. In 1964 there were 2.75 dollars to one £ and now it is 1.4 dollars to a £. Clearly UK £ has weakened.

It appears that you did not get my point. Ever since other nations went off the Gold Standard in 1944; US Dollar is the reference currency. US dollar does not need to devalue or re-value. Dollar value automatically goes up or down when other currencies weaken or strengthen against it. Should IMF ask the USA to devalue her currency, pray advise against which currency?

In actual fact USA dollar loses or gains value a few hundred times each day in the international currency market. When 105 Pak Rupees equals $1/- one day and 104.50 Rupees the second day, does it not mean that US dollar has devalued?