Lots of people are getting fed up looking at their cash earning next to nothing on deposit. Yes, it seems to make sense to hang on and just sit on the money, and yes, it is nice to have survived all the possible troubles so far, but hey, the boredom of it all!
A friend of mine phoned me recently saying that he is slowly going nuts waiting for some action. I smiled and told him “You mean you are itching to invest into some currency but are scared to take the plunge, right?”
“I guess” he said, waiting for me to come up with a suggestion without having to make it look like he was fishing for advice.
If the urge to get some currency action is strong enough and the feeling of sitting on non working money is unbearable, that is a situation which needs careful handling. One must not get into a state like an alcoholic who craves for a drink, or a gambler who needs to have a bet for the sake of having a bet.
It is not very easy to fall in love with any currency these days. However, it is not hard to feel jittery about holding one type in particular, namely Sterling. Lately, when I think of GBP,I see an acrobat wobbling on a tight rope with no safety net below and a strong gale approaching. Now, getting rid of it, means one has to get into another currency. Personally, I have the feeling that of late, the USD is beckoning and saying “Hey, come and get me before it is too late”. It does not mean that many people do not have a different opinion. This is just as well, since any market needs a buyer and a seller.
It does not need a lot of imagination to come to the conclusion that the USA will be the real first to come out of the recession. Equally, it does not need a lot of imagination to realize that it cannot be possible for GBP to be prodded up for ever or ride on the back of this or that sentiment or risk appetite. Somewhere along the line, all this has to be paid for in full. This will mean that the belt will have to be tightened, and whoever will tighten it, will not be too popular with the masses, as is invariably the case. But that of course, is another matter.
The weapons of opportunity have to be carefully maintained in tip top condition, as must be the knowledge of when and how best to use them to obtain maximum results. Everybody gets a chance to strike it right at least once, and I am sure many of you will admit you have had that chance, only to see it go out of the window due to being totally unprepared to grab it. This does not mean that one should consider dicey prospects. It is prudent to know when not to proceed, let go, and walk away.
With all this in mind, I phoned my friend saying that if the need was so great as to have to get into some action, then I would get rid of my pounds pronto, and get into dollars. I would not expect miracles immediately, but I would expect to go forward in style in due course. The game is not for tame little birds, it is more for vultures. They have a knack for spotting prey, but we know a vulture is a patient bird.