Why It Is Time to Buy the Japanese Yen

Most people turn to gold when thinking about investing in a “safe haven”. However, only a few know that the Forex market also has its own anti-crisis refuge. It is called the Japanese Yen. The world is in a very unstable position right now. Oil price is very volatile and after many intents, oil-producing countries haven’t been able to come up with an agreement to freeze output.

Signs of The World’s Economic Instability

At the beginning of April, candidate for U.S. presidency Donald Trump forecasted that the U.S. was headed towards a “massive recession” in the coming months. World economists have opposing views regarding the financial future of the U.S. Some like Peter Schiff agree that the stock market is overvalued and that the data shown by the government is more optimistic than what reality really is like. Others are more positive and expect job growth to recover.

On Europe’s side, negative interest rates implemented by many Central Banks threaten Europe and the world’s economy too. Switzerland and Sweden have entered into this territory with rates of -0.75% and -0.35% respectively. Their purpose is to pay their sovereign debts which they haven’t been able to pay via any other method. They also aim at boosting economic growth by making loans cheaper. This will allow consumers to increase their spending. However, negative interest rates come with a big financial downside – In fact, economist decades ago even said they were an impossibility since people would prefer to preserve their capital at home instead of buying a government bond with a negative yield. Given the fact that banks won’t pass those negative rates to lenders since people would prefer to not save money at all, the whole banking system may stumble. This is so because they do pass those rates to borrowers. At the end of the day, banks will have lower earnings and higher expenses which can easily send them downhill.

In China, total debt reached its peak record in the first quarter of 2016. It reached 237% of its GDP. The People’s Bank of China has borrowed a total of $25 trillion in order to boost its economy. Historically speaking, debt growths such as the one seen in China usually result in either slower growth rates or a recession.

Now Let’s Go Back to the Japanese Yen

The reason why the Japanese Yen’s value goes up when there is a financial crisis (or signs of it) is because on average more Japanese investors have their capital on foreign markets than foreign investors have their funds in the Japanese market. Thus, when signs of crisis emerge, Japanese investors sell their foreign investments and demand for the Yen increases internally. On the contrary, when foreign investors sell their Japanese investments it doesn’t result in a dramatic increase value of their local currency.

Besides the possibility of a world economic crisis, another factor that may play positively for the Yen is Japan’s monetary policy. Japan has resorted to stabilize its economy via asset purchasing in the last few years and has left quantitative easing on the side. On the other hand, the European Central Bank has created a QE program that started in 2015 and will go all the way to 2017. Quantitative easing lowers the value of the currency. Thus, the Yen can expect its value to go up when compared to those countries that have QE programs.

CMC Markets provides a reliable platform with live news for free for investors who want to buy the Japanese Yen or become Forex traders. You can also open a demo account with them with virtual money and start practicing your moves with no risk involved.

8 Things You Should Do Before You Quit Your Job

8 Things You Should Do Before You Quit Your JobLeaving a job is seldom easy because your livelihood is tied directly to your employment. That doesn’t mean you should stay in a job you hate or that’s not letting you meet your career goals. If you’ve decided to quit your job, here are some things you should do to make the transition smoother and leave your reputation in tact.

Be sure quitting is your job is the right choice. Sometimes leaving a job is a no-brainer and sometimes it will feel like the toughest decision you’ve ever made. Before you put a plan to resign in motion, i.e. tell your employer you’re leaving, think through your decision to leave and be sure it’s the best thing for you right now.

Update your resume to include the most recent information about your role and duties. If you’re planning to hunt for a new job, an updated resume is essential.

Line up a new job. Ideally, you’ll have another job – or some source of income – before you resign from your first one to eliminate a gap in income or lapse in health coverage. Avoid job searching on company time or using company resources (like your work laptop) if you don’t want to tip off your employer to your job search. Also, be careful what you put on social media about your job search just in case your employer is monitoring your social media pages.

Stash some money away. As you contemplate leaving your job, it’s smart to cut back your spending and start putting extra money into savings. This is especially true if you don’t have another job lined up or if there will be a gap in your employment.

Apply for any loans before you leave your job. Once you quit your job, you may find it harder to get approved for a loan, even if you’ve started a new job already. Because lenders look at the length of time you’ve had in a particular job to predict your financial stability, a recent job change could make it harder to get approved. So, apply before you quit your job to improve your chances of being approved.

Remove your personal items, transfer personal files and contacts from your computer and smartphone. Don’t take confidential or proprietary company information with you or else you could be sued. Try not to make it obvious that you’re clearing out your personal items, e.g. carrying a big box of your things out the door, unless you’ve already announced your resignation.

Give proper notice. The required time period may vary depending on your employer, but two weeks’ notice is generally standard. Regardless of why you’re quitting, be pleasant in your resignation letter and thank your employer for your time at the company. Leave on a positive notice because you never know if you’ll cross paths with your employer or if you’ll end up coming back to the company in the future.

Talk to HR about your benefits. You may be entitled to some company benefits – like unused sick or vacation days – when you leave. At the very least, get an understanding of what happens to your retirement plans. And, if you’re not starting a new job right away and don’t have other health coverage, ask about continuing your health insurance through COBRA.

The more preparation you put into your resignation, the easier it will be to quit your job. Start preparing once you’ve made the decision to quit.

The UK’s property market could tank if the public vote to leave the EU

On April 1 of this year, less than three months before the much-anticipated EU referendum to be held on June 23, HMRC introduced a new tax that may affect you. The new stamp duty requires that homebuyers pay an additional 3% surcharge on top of the total sale price of a new home, if a) you already own another house in which you reside at least part of the time b) you already won another house which you earn rent from (but rent or otherwise reside elsewhere), or c) your name is on the deed to a house where your spouse or ex-partner resides.

If you’re planning to buy a house, this will add a significant amount to the total. Use this stamp duty tax calculator to figure out the original charge on your home (since it’s worked out differently depending on the price bracket your home is in). Then add 3% of the total (sale price + initial stamp duty). As an example, let’s take the average price of a house in the UK, now around £265,000. The amount of stamp duty payable by a first homebuyer on a house of that price is £3,250, bringing the total up to £268,250. Add on another 3% to that figure gives £276,297.50. That’s a total of £11,297.50 in stamp duty. Ouch! Use this mortgage calculator to see how much that extra £11,297.50 will realistically cost you over the term of your repayment.

If, in the example above, you’re buying an investment property or a second home, you’ll be paying around £3,350 more in stamp duty than you would have previously. But this extra surcharge is part of a sweeping reform that means the majority of home-owners, who are either buying their first home or moving house, will actually be much better off. If you buy a house for £265,000 today, and that house is your only piece of residential property (or will be once you sell of other owned or partly-owned properties), then you will only pay the £3,250 in stamp duty. So first-home buyers and people moving house will save about £3,700.

Whether you’re about to buy your first home or your fifteenth rental property, the new stamp duty charge means that your mortgage repayments are going to be different than they were before April 2016. If it’s been a few months since you reviewed your options, it might be time to take another look at possible mortgages.

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