Did Chinese Currency Trigger a Global Currency War?

A global currency war is no longer a possibility. With the recent devaluation of the Chinese currency, things have already started moving in that direction.

As we all know, Chinese currency Yuan has not been doing so well of late. The value of the Yuan has been declining for a while now. However, that has brought our attention to an imminent currency war. That doesn’t mean that we are on the verge of it. But by the look of it, we are heading to a similar scenario. China lowered the value of their currency, multiple times recently and that has affected several other currencies all over the world. When China lowers the value of their currency, other developing countries would be compelled to do the same. We have to see the bigger picture as the Yuan is not doing that well at the moment. It is a critical time for Yuan. However, one should remember the fact that Yuan was given an entry into the elite club of currencies by IMF.

Who is behind currency war?

Well, first and foremost, you should realize the fact that the Chinese government has nothing to do with this currency war. Many experts and observers share this opinion. It makes sense since China is allowing market forces to have a bigger influence over their currency. But lowering the value of the Yuan has snowballed effect on other currencies and economies alike. At the moment, Yuan is down 6% against the dollar compared to the scenario in the previous year. We are all aware of the devaluation happened in August and it was a surprise for many of us. On Thursday, Chinese Central Bank has lowered it even further and things are not looking good. If you want to learn more about other currencies like the dollar and the euro, Click Here.


Snowball effect

How did the devaluation of Yuan affect the currencies of other Asian countries?

  • The currencies of Thailand and Indonesia suffered a blow soon after the devaluation. Both registered a fall close to 10%.
  • The same can be said about Taiwan and Vietnam as well, even though it’s not as severe in their cases. Vietnam registered 4% fall whereas Taiwan registered a 6 % fall.

Trade relationships

China’s trade relationships with other Asian countries are a big factor here. There are two sides to these relationships. They are trade competitors as well as trade partners. Or in other words, the other Asian countries are foes and friends at the same time for China. The devaluation has actually worked in China as far as global trade is concerned. Their export has become cheaper as a result. Foreign buyers find their exports even more attractive. So, to compete with China, other Asian countries have to devaluate their currency in the process. They all want to maintain a cheaper currency and it is no secret. The problem with such a scenario is that emerging markets are forced to react quickly, that too in a negative manner. They all want to retain their competitive edge and such a scenario can trigger a currency war.

Global currency losses

One cannot ignore the implications of global currency losses. If we take a closer look, we can see that the external forces are reducing the value of Yuan than the Central Bank of China. In fact, the Central Bank in China spent a lot of money to prevent this from happening.

The Best Tax Free Investment in USA

Are you looking for the best tax free investment? If you own house where you currently live, you might be eligible for tax exemption.

First and foremost, what do you mean by tax free investment? For example, you have sold the house you have lived in – in that case you will be eligible for tax exemption and you will get to keep the whole amount. Here occupation has no significance. Have you stayed there for the last 36 months as the owner of the house? Then you are eligible for tax exemption. We hope now you have got an idea about tax free investment. However, you will have to deal with several scenarios here. For example, rules may not be the same if you own two houses or you weren’t an owner for a period of time.

Tax exemption

Let’s see a few special cases where Tax exemption is available.

  • In case if you own two houses, you will be given tax exemption if you have been an occupying for more than 3-year period.
  • Being an owner alone won’t work. You should reside in both the properties to be considered for tax exemption.

Dwelling house

Let’s examine the case of a dwelling house. Well, when it comes to a house, even a houseboat and well-maintained caravan would be qualified. It is just that it should have a couple of basic facilities like telephone, water and electricity. Also, you should be a permanent owner and you should be residing in the dwelling. Also, converted buildings also would be qualified including barns, warehouses, churches, windmills, lighthouses and many others. If you want to Learn More about Investment Opportunities in the US, click here.


Interesting cases

Let’s examine few interesting cases regarding a dwelling. Let’s assume that you have more than one property in the case of a dwelling. Here you will have to exempt few and you will have to decide which one should be exempted. Let’s take the case of the small building – is it secondary to a main building? Does your staff live in this small building? Or was it built keeping that purpose in mind? Is this secondary house too far away from the main one? If it is far away, one cannot consider them as a single unit. This is an interesting case which clearly needs more introspection.

Garden or grounds

Now let’s examine the case of garden or grounds or yard. You need to understand the fact that they also come under the purview of same exemption. They also enjoy the same exemption as the house. But the only thing here that it must be for your own enjoyment and occupation.


Is there going to be an exception? Well, as long as you are able to prove that the greater area is meant for your own enjoyment, then you will be able to walk away with the exemption. However, they will consider the overall character and the size of the house into consideration. There are so many things that will make the definition clearer.

Length of occupation

Length of occupation is another important matter you need to consider. How long have you been living there? Well, the continuity is a big factor. There should not be gaps in the occupation.

How Small Business Powers the US Economy?

People have this false notion that big corporations are driving US economy. They might be in shock to realize that small business is what drives the economy.

There are many who assume that it is the large corporations that provide all the jobs and support the economy. This is far from the fact and in fact the large corporations play only a small role in comparison. When it comes to any economy, including US economy, the small businesses are what drive the economy. If you don’t know already, 70-80% jobs are created by small businesses every year. And now you know the significance of small businesses.


Let’s take a look at the contribution of corporations as far as job creation is concerned. If you combine the jobs created by corporations and governments, you will see that they create only 20-25% of the jobs in the US. Small business is the backbone of America without any doubt. We are strong because of the small businesses and nobody can ignore them. However, small business hardly gets the respect it deserves. We need to applaud them more for backing our economy time and again.


No exaggeration

Yes, we are not exaggerating at all. It is clearly not an over the top statement. We have several reasons to stick to this comment. First and foremost, it is the truth and we should tell the truth. The problem with this is that not too many want to see the truth. Well, in that case some explanation might do the trick. Small businesses are indeed the true engines of our economy. However, you need to understand that we have nothing against the government or the corporation – both are creating jobs and very important. But the credit should be given where it is due. Knowing More about US Banking Sector will also be helpful – click here for more information on this.

Why small business matter?

When a small business does well, they have to hire more people. When more people are employed, there are many happier homes. Also, they will have more money to spend and this is going to help the economy. When people don’t have enough money they spend very less. In that case, they buy products and services from small business as well as big ones. At the same time, good profit will allow small businesses to expand their business and target bigger growth. Well, are you able to see why small businesses are really important to the business are concerned? Yes, when it comes to big corporations they employ so many people in comparison. But there are only a few big corporations in the USA and they can’t employee millions of job seekers. Big corporations pay well, but you need to understand the fact that they can create only a fraction of the jobs. They have their limitations when it comes to job creation. Keeping that in mind, you need to understand the significance of strengthening our small business sector.

American employees

Yes, that is the most important thing here. When it comes to big corporations, they are always looking for cheap labor. So they head to other countries where cheap labor is available. So, they are taking away the job opportunity of many Americans. That is where small businesses score as they always hire local talent. That means more Americans will be employed. That means more jobs will be created for more Americans.

US Congress Makes Sure that US Leads Global Finance

The U.S. has been leading the global finance for several decades through the IMF. U.S. Congress has finally made sure that it remains so.

US Congress has finally made sure that US will continue to be a global leader. They have approved a $1.1 spending deal to make sure that. As a result, the International Monetary Fund will have a new lease of life. US has been the leader of global finance for the past seven decades and they are going to continue the same tradition. They have no plans to let go of the leadership of global finance yet. US Congress has finally made sure that it is a reality as they have been mulling over this for a while. By this measure, the IMF will get a contribution of $300 million. As you know, the IMF is doing everything to help the countries which are in distress including Greece and Ukraine. The IMF is trying everything to avert the global financial meltdown.

Obama’s determination

We have to mention the fact that President Obama has pushed hard for this to happen. He said that it is vital to US. He added at the security of the leadership of the country needs such measures to be taken. According to the legislation, developing nations like Brazil, India, and China etc. will get a bigger voting power in the IMF. Also, US will continue to enjoy the sole veto power as US enjoys 16% of the votes. In an interesting development, China now has 6% voting share, whereas it had 4% voting share beforehand. As far as these reforms are concerned, they were introduced in 2010 but it was blocked by inaction on Capitol Hill.


The U.S. has paid a price

Since Congress took so much time to do this, the U.S. is at a loss today, blames former Treasury secretary. According to him, is has resulted in China making a move. China ended up setting up alternative financial institutions that challenge the dominance of the IMF. The IMF has been dominating the financial scene since the end of World War II. If you don’t know already, China has recently founded the Asia Infrastructure and Investment Bank to counter the dominance of the IMF. This new organization is based in China. Moreover, China has sought the help of BRICS countries like Brazil, India, Russia and South Africa to form a new development bank that will end the dominance of the IMF. This bank is meant to support the BRICS countries when they need money the most. Also, this is meant to deal with the financial sanctions posed by west on the developing nations like this. If you want to know more about The Financial Sector in US, click here.


If we take a look at the history of the IMF, we can see that the U.S. has been one of the major players ever since they founded this in 1944. However, congress support for this important organization was not defined clearly. In the last few years, many members of the congress accused that IMF bailed out many big banks over the loans they couldn’t recover. However, experts say that it is important for the U.S. to back IMF as this organization has been protecting the financial interests of the country for very long. He has the opinion that IMF promotes free markets and that has to remain that way.

Main Reasons why You Don’t have a Pension

Many of those who are on the verge of retirement worry about not having a proper pension plan. Here’s a guide as why they don’t have a pension plan.

There can be several reasons why your employer is not guaranteeing a pension for you. Many workers who are all set to retire wish that they had a traditional pension. They know that the poorly funded 401(k)s are not going to give them what they are looking for. However, only few workers get to enjoy a good pension system that guarantees regular payment. Only less than one third of the total work force was allowed to have a regular pension in the past few years. Moreover, only 28% participated in this. So, what are those reasons that come in the way of walking away with a normal pension? Well, let’s take a look below.

Not having a union card

Yes, if you do not belong to a union, it would be increasingly difficult to have a pension. When you have a union card, chances are high for you to have a traditional pension plan. Only 82% of union members get to access traditional pensions. When it comes to those who do not belong to a union, only 21% have access to pension. Well, you need to realize the fact that unions will do a good job in negotiating a pension plan for most of their members. So, if you are worried about a proper pension plan, we advise you to be part of a union as soon as possible as it can be really helpful.


You are not a government employee

Well, if you are a government employee, it won’t be that difficult for you to have traditional pension. Otherwise, it would be really difficult. Most of employees who work for the state and local government managed to walk away with a good pension plan. Studies show that more than 84% enjoyed a pension in this manner in 2010. As for those who work in the private sector, only 20% of the workers got regular pension. There are several benefits when it comes to a pension plan like this. For those who are looking for more information on the Pension Schemes in US, click here for more information.

You are not working for a big company

Yes, in case if you are working for a small company, it can come in the way of getting a proper pension. When it comes to large companies, they offer generous retirement packages. When it comes to the case of big companies with more than 500 employees, they are able to offer a good pension plan to most of their employees. When it comes to companies with a small work force (for example, less than 50 employees), they are not able to guarantee a proper retirement plan to their employees. One thing you need to understand is that having a pension plan is a really complicated thing and not too many companies are able to handle it in the right manner. Small companies don’t want to go through the hassle.

You are working in a pension-less industry

Yes, this also could be a reason. There are several industries where you cannot expect to have a pension owing to the nature of the work they are doing. Let’s take the example of the utility and we can see how that works.

Investing in USA – Tips for Beginners

Risk is a big part of the investment. However, if you are ready to learn the basics, you can be a successful investor.

Investment is an intimidating thing for anybody. So, you can imagine what a beginner might be going through. So, let’s try to understand some of the most popular investment options including mutual funds, stocks and real estate. As a beginner, getting to know these options will be very useful for you. Once you know how they work it will be less intimidating for you. First and foremost, how much money are you going to invest? You need to consider the scenario where you lose all your money. So, you shouldn’t gamble with your savings and instead you should use the expendable money. In case if you don’t have expendable money, you should wait for more money to come your way before you take the plunge. Once you have clarity about the amount you are going to invest, things will be easier for you to select an option.

Investing in stocks

Yes, it is the most popular investment strategy you can think of anywhere in the world including USA. There are so many websites to help you with your decision. Or you can go to a professional stockbroker who will show you the way initially. Whatever be the scenario, you will need assistance initially. You cannot do it yourself as it can be a foolish decision. As for choosing the companies to invest in, going with your favorite companies may not be the smartest idea. You should select a company based on your research, not otherwise. Rely less on intuition here.

1Investing in mutual funds

Mutual funds are another popular investment option. Mutual funds are meant to a combination of different stocks. Here, you will be investing in many companies instead of focusing on a single company. You will get the service of a mutual find a brokerage house for the same. You will be able to diversify your investment. The good thing is that you will be able to reduce the risk factor considerably here. Moreover, you will be able to protect the money you already have.

Investing in real estate

Real estate is another important investment option before you. It is one of the most popular investment options. Though it will take a couple of years to see returns, it could be a highly profitable investment option when you play your cards right. However, you will have to show more involvement here if you are looking for lasting success. If you wish to know more about Real Estate Investment in USA, click here. You can buy a piece of property and give it for rent. You will be earning good money every month. And you will be able to sell the property after a few years for a bigger amount. However, upkeep is an issue here as you will have to maintain it properly. And that means your involvement will be higher here. Or in other words, it requires lots of labor. Moreover, you may not be able to enjoy the rewards for several years. Property value might increase with time. However, you will have to wait for a few years for that. Or you can go for real estate investment groups if you wish to.

Real Estate Investment in USA for Foreign Buyers

As a foreign investor, you have a golden chance to make money by investing in the real estate sector in USA. But you have to consider many things beforehand. As you know, the Great Recession has finally been fading away. The market is clearly excited about a recovery that is imminent. Foreign buyers are finally showing confidence in investing their money in the business here in the USA. The real estate market was the worst hit during the Great Recession and the real estate sector has finally put that phase behind. Today, we can feel the enthusiasm. However, we have to caution you that it is still in the ‘work in progress’ stage. Though there is a positive sign in the industry, buyers are not that confident yet to go all out. Also, the position of the dollar has weakened over the years and that is clearly not a good sign. But as you know, the American real estate market cannot stay down for too long. It’s the right time to invest as you will walk away with profits very soon. But there are so many things to consider and let’s take a closer look at them below for your consideration.


Document everything

Before you make any transfer, you will be able to verify the source of the money. You need to understand the fact that the Federal authorities will be notified for every transaction to USA above $10,000. So, you need to have all the documents ready when the Feds come to question you on the source of that money. You will have to prove that it comes from a legal source. When it comes to any large deposit, you must report to the federal authorities. When it comes to many new buyers, they forget to do all these things and they might land in trouble. So, make sure that you are following the law in the right manner. You need to have all the documents ready with you so that you will not have to worry about any of those later. If you are looking for More Investment Advice, Click Here.

All cash buyers

When it comes to buying real estate, you can go for all-cash buy or financing. All-cash buying has several benefits. It’s a fast process and most of them will be interested in doing business with you as well. You will also enjoy very good discount as well. You will see that deals are closed really fast as well when you go for all-cash route. However, I wouldn’t say that this is the best option for you. I would suggest you to consult with a real estate investment advisor. An advisor will be able to show you the right path. Only an expert can show you the right way.

Control your assets

This is really important. You will have to control your assets for your own good. You can own a property under several titles, including individual, partnership, corporation, pension fund etc. Each of these entities has their own advantages and disadvantages. You will have to consider all these before you buy a property. You need to figure out how you want to own it before you go ahead with it. I will advise you to talk to a knowledgeable international tax advisor.

Different Types of Pension Plans in the USA

There are different types of pension plans in USA. I would suggest you to go for qualified pension plans as they provide very good tax exemption.

Let’s take a look at different types of retirement plans that are available. Let’s take a quick look at them below:

  • Government sponsored plans

There are so many government-sponsored retirement plans. The social security plan is the most significant one among them.

  • Personal plans

There are so many personal plans. However, the Individual Retirement Agreement (IRA) is the most popular one. There are various types of IRA plans. Different plans have different tax plans.

  • Annuities

We are talking about contracts here. These contracts are involving insurance company. As far as annuities are concerned, there are variable as well as fixed annuities.

  • Employer-sponsored pension plans

Employer-sponsored pension plans are equally popular too. Let’s take a closer look at it below. First and foremost, there are 2 types of such plans. The first one is referred to as non-qualified and the second one as qualified.

1Qualified pension plans

Let’s have a closer look at the qualified pension plans below. Qualified pension plans have to meet the requirements of Internal Revenue Code. They also have to comply with the rules of ERISA requirements. Therefore, such plans come with many benefits for the pension seeker. What are those benefits you were talking about? Well, first and foremost, they allow employers to deduct the annual contributions for each employee. Such earnings and contributions will be protected from tax. The best thing about qualified pension plans is that you will get lots of tax deduction, which other plan may not be able to give. If you want to Learn More about US Pension Plans, then you should click here.

There are different types of qualified plans and let’s take a closer look at them below.

Defined benefit plans

Let’s first examine defined benefit plans. We are talking about company retirement plans here. When you retire, you will get a specific amount depending on your salary history. Your years of service also will be taken into consideration. Here both the employee and employer will make an equal contribution into the pension plan. As you can see, the employer has to bear the investment risk here. Who benefits the most with such a plan? Those who have 20 years or more until their retirement will find this plan very helpful. The most important thing here is that it involves larger annual contributions.


Let’s examine pensions next. According to the pension plan, you will be given a certain amount when you retire. This amount is guaranteed. How do they calculate the amount? They consider several factors for the calculation. The salary of the employee is going to be a big factor. The number of years you have been in service also will be taken into consideration. Last but not least, they will consider fixed percentage rate as well here. PBGC is the government agency that will ensure that you will get your pension. They make sure that employer-covered pension plans benefit the employee. The good thing is that they will ensure that you get the pension amount even when the company faces financial troubles. As far as eligibility is concerned, company policy will be the main concern. You will have to check with the company to learn more about this.

6 UBS Forex Staff has been Banned by Swiss Watchdog

6 former managers and traders of UBS Forex staff have been banned for 5 long years, for allegedly manipulating foreign exchange as well as precious metals.

What exactly happened?

FINMA which happens to be a Swiss financial watchdog banned 6 former traders of Forex because they heavily breached the regulation of the company by manipulating with foreign exchange as well as precious metals. The name of the traders has not been revealed, but the charges against them are quite strong. FINMA has been on a mission to find out individuals as well as companies who breach the laws of Forex and are on the lookout for those with misconduct.

In this quest around 7 banks have been fined with somewhere around 10 billion dollars. According to FINMA traders share really confidential news and reveal the identities of the third party which is against the Forex rules. After repeated attempts of breaking the benchmarks of the regulations made by Forex these people were found guilty.


The beginning

FINMA has been investigating the case since 2014 and has kept a close eye on 11 UBS staff, 6 out of which were found guilty of breaching the regulation of the company. 4 traders have been banned of foreign exchange as well as precious metals for at least one year. In the past, there have been many such breaches in Forex and those have been addressed with strict action. However, even after so many cases, there are a number of traders who are still engaged in such malpractices and that needs to be addressed. With the growing economy, things are going to become more complicated ad give rise to such problems for which action is required. Countries such as India and China are emerging as a really strong powers, and it is the duty of those involved in foreign exchange to be strict and stern to match up to the standards of Forex. To find out How the Indian Economy is Growing and what are its implication on the world market, click right here.


With FINMA is becoming such a stern and firm body when it comes to the adherence of the Forex laws, countries must take example from it and avoid all kinds malpractices. The fact that such strict a prompt action has been taken, those involved in corruption with foreign exchange will be warned. Being barred from participating in trade for one whole year can give a major blow to trading companies, and such a punishment is apt for such crimes. Trading companies must now adhere to all the standards of Forex to avoid any kinds of legal battles, because once the problem is highlighted, it will become very difficult for the company to get out of the legal battle without losing out. Rigging of currencies is a serious crime and no country would want that to happen, therefore, more laws are required to keep traders in check and to avoid any such problems. FINMA must be appreciated for its hard work and scrutiny which became fruitful in catching hold of all those involved in rigging of the currency. The probe is still going on, with the other suspects and the results will come out soon.