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Home > About Us > In the News > Feb 09, 2009

In the News: AP

Portfolio manager Axel Merk tells Associated Press that corporations that match local revenue with local expenses may be best prepared to deal with volatility in the currency markets.

"Axel Merk, president and chief investment officer of Merk Mutual Funds, said the most successful companies when the dollar strengthens have local production facilities for local sales. In other words, goods sold in Britain are manufactured in Britain. That way, at least, companies are not forced to pay expenses in one currency and record sales in another."

"Ordinarily, some companies would raise prices overseas to offset the unfavorable exchange rates. But the downturn in the global economy has made that a dubious proposition - consumers are already cutting back on spending, and higher prices could mean even fewer sales. And that, in turn, could make profits even lower. "