Day after day, investors hear about "foreign currency impacts" on earnings... which are dutifully shrugged off by pandering protagonists on mainstream media - "if you just ignore the currency effect, everything is awesome."
Well the truth is - unless you have lived it and seen it, you have no idea of the massive impacts that a soaring dollar (and collapsing currencies across the emerging markets - which every firm still believes is the engine of global economic growth).
So here, for some terrifying clarification, is Microsoft's latest product pricing announcement:
[4]
So - for various countries from Russia to Brazil and from Algeria to New Zealand, while maintaining its USD purchase price, Microsoft has adjusted its loal price "to reflect fluctuations in the currency exchange rate."
In the case of Brazil shown above as an example - the local price of a Microsoft product just went up from BRL 6.5 to BRL 10.3...
That is an enormous 58% inflation in local pricing!!
How would you imagine that will affect local demand? And this is happening in every country and for every US corporation's products.
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Is The Fed about to hike rates, sending the Dollar even higher, and simultaneously crushing global demand?
h/t ForrestM