LIVING OFF DIVIDENDS & PASSIVE INCOME

Today the Loonie achieved parity with the US dollar for the first time in 30 years. Five years ago, 65 cents could buy you 1 Canadian Dollar. Since then the Dollar has devalued 50% against the CAD and nearly 100% against Gold. This has been partly due to a massive increase in the number of Dollars floating around, and partly because of the low interest rates which no longer attract much foreign interest.

The 50 basis point cut in the Federal Funds rate isn’t going to save us from recession. What it definitely did do is weaken the dollar further against all major currencies.

How are you going to Hedge against a weakening dollar?

I been a strong advocate of investing in Gold and Silver for 2 years. Today Gold hit $735 after trading around around the $665 mark for the past year.

I realized that the Feds were going to drop the rate last week and put in an order to buy FXA. FXA is the CurrencyShares Australian Dollar Trust, an ETF that tracks the price of the Australian Dollar. Immediately after the Fed rate cut it jumped 3% and is up 4% for the week. It also pays an annual yield of approximately 5% on a monthly basis.

As the Dollar continues to weaken, I expect FXA to keep on appreciating. The question is how low do you think the Dollar will go?

• Cheney Betting Against The Dollar Not exactly fresh news, but its been reported that Dick Cheney, our beloved vice-president is betting against the US Dollar. He has tens of millions of dollars in foreign government bond and currency funds and international and emerging market stocks. His excuse is that it's in a blind fund and......
• Protecting Yourself Against Inflation While the debate between inflation and deflation keeps on going, I'm firmly in the camp of inflation. And so is Warren Buffett, as are many other investment advisors. So how do you protect yourself and your investments from the effects of inflation? Investment newsletter editor, Keith Fitz-Gerald, recently had a......
• Sam Zell Imparts His Wisdom One of the advantages of going to a top-tier MBA program is that you get to meet a lot of succesful, well-known people. Last week, billionaire real estate investor Sam Zell was on campus and gave an hour long speech about his views on the economy. He made an analogy......

• Buying Expiring Domains and Parking/Selling This is a off the topic of Prosper, but since I am going to send the proceeds to my Prosper account I think it works. :) I read an article in a leading national magazine on buying domains for use as AdSense sites (arbitrage between the cheap misspelled AdWords and......
• Epic Wimbledon Final Recap The epic Wimbledon final that happened last Sunday between Roger Federer and Andy Roddick has been ruled as the most viewed of all men's finals at the All England Club in the past ten years. According to NBC last Thursday, an average of 5.71 million people had tuned in, in......
• Interview with Own the Dollar How has blogging on Own the Dollar, changed the way you look at finances? I don't think blogging has changed the way I look at finances too much. I've always loved all things money, economics, and business related since I was about twelve years-old. As sad as it sounds,......

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