Yes, you're right, perhaps I should have said "Dollar to Peso exchange rate is taking off". What I meant to imply is that is now getting more advantageous to transfer dollars to pesos.
This usually means inflation. It is not a good thing for us in the long run. Prices here may start to skyrocket...and they will never come back down. Remember when a pack of cigarettes cost 30 pesos? A long neck of tanduay was 65 pesos? An SML was 20 pesos...in a bar!? I do. Back in my day.... Oh sh*t...
I watch the £ v Php rate many times a day. I have been puzzled why the pesos has been climbing over recent months when the vaccine program here is not that good and does not look like it is going to be completed for years. The UK has a very good vaccine program but still has a fallout from Brexit and that may be the problem. The £ has recently strengthened and the USD dollar has done the same - in both cases I think due to a weakening of the appetite for pesos. There is growing inflation worldwide, especially in certain commodity prices (most due to the pandemic and the Suez canal blockage), and I am not sure that is the cause of the weakening of the peso. Perhaps economists took a while to see how bad the situation is here. However, inflation is now a very major concern and I will be very surprised not to see massive falls in stocks and shares along with property prices and all other classes of asset bubbles. Even those who think I am wrong cannot deny that economics is cyclical and unless the 'new economics' of 'printing money and boosting asset prices' is workable in the long-term, a collapse HAS to be coming. But when?
Economics has changed in ways that are not fully understood. In the past, inflation was driven by wage inflation that increased the amount earned by workers. This is because there was an increase in opportunity. This increased the cost of the goods the workers made. (Food, services, etc.) It did not necessarily increase asset costs. This was very bad for non-working old people on a fixed income because their purchasing power was reduced. Now we have asset inflation without wages going up. This is a simple case of supply and demand. The supply of money has gone up yet the opportunities have remained the same. Wealthy people have more money but do not have better opportunities about where to invest it. They compete for the same opportunities thereby driving the price up. Most wealth is held by the older middle class, not the super rich and not young people. In the past old people on fixed income would get mad and vote accordingly. Now the population getting screwed is the younger generation who do not vote as much. So what will pop the bubble? It may continue on and on until the young throw a revolution. This is the typical cycle. Over time the older status quo gains more and more control over assets until the young disadvantaged population revolts. Democracy gives a stronger appearance of equality so this may postpone the "adjustment" for a long time as wealth inequality becomes worse and worse. This bubble may take a long time to pop.
Prices here may start to skyrocket.... Have you been asleep LOL. Prices have sky rocketed for the last year or more.
Yeah, and this, along with the threat of more lockdowns, a slow vaccine roll-out and local vaccine hesitancy, probably won't do us or Filipinos any favors.
That might be a very good thing for the country's health but I would NEVER dare say that here on this Forum.
