It’s been kind of a slow blogging week for me. I have been in Vegas attending the Blog World and New Media Expo and, ironically, haven’t posted much to my blog in the meantime. I’ve also been revamping my Save Otero website because we had some news come in and it was very difficult to make changes to the old site.

Here’s an interesting story from Bloomberg about how different national banks are taking steps to soften the impact of the falling dollar. What’s in store for the economy as we enter the typically “agressive” holiday season?

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Nov. 12 (Bloomberg) — Central banks from Bogota to Mumbai are imposing foreign-exchange curbs to take control of their soaring currencies from traders dumping the dollar.

In Colombia, international investors buying stocks and bonds must leave a 40 percent deposit at Banco de la Republica for six months. The Reserve Bank of India created a bureaucratic thicket to curb speculation by foreign money managers. The Bank of Korea is investigating trading of currency forward contracts to limit gains in the won, now at a 10-year high.

Instead of using currency reserves or interest rates to influence foreign exchange markets, central banks and finance ministries are setting up obstacles to keep the falling dollar from threatening company profits and economic growth. The U.S. currency slumped 10 percent this year against its biggest trading partners, the steepest decline since 2003, while Treasury Secretary Henry Paulson has reiterated that the U.S. supports a “strong” dollar.

“Central banks are struggling to find new ways to intervene against their currencies and some of the proposals simply can’t work,” said Mirza Baig, an analyst in Singapore at Deutsche Bank AG, the world’s biggest currency trader. Some plans are “truly bizarre,” he wrote in a report.

The U.S. hasn’t attempted to stop the decline as the worst housing slump in 16 years forced the Federal Reserve to lower interest rates. The dollar has weakened 19 percent against the Canadian currency this year to a record 90.58 cents, and fell 18 percent versus Brazil’s real.

Read more…

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