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Back in the day, many rock bands simply played to their “home crowd” in their own country.

American-based bands played all over the U.S. and European rock bands played all over Europe.

But these days, people around the globe can watch bands from every corner of the world on the Internet, so many bands now have a global audience.

For years, bands flew around the globe and were “rocking the world”.

But then 2008 happened!

The credit crisis changed everything and many currencies started dropping like a rock. This is when bands like the Red Hot Chili Peppers and Metallica had to start rethinking how and where — not to mention the tempo — with which they perform.

Right now, Cliff Burnstein, who manages both of these bands, is accelerating Metallica’s European tour plans for fear that the euro will drop even further in the months ahead.

It’s looking like they may be “playing to a faster tempo” to get the heck out of there since their fees will be paid in euros.

So what’s the plan? Mr. Burnstein says: “You’ve got to ask yourself: What’s the best time to be doing what, when and where?”

Timing Where to Play Next

Mr. Burnstein is also speeding up the Red Hot Chili Peppers’ European tour.

Where’s he sending the Chili Peppers next?  To Latin America, of course, because the currencies there are holding up better than in the U.S. or Europe.

In the meantime, eight months before he negotiates further contracts in Europe, he’ll look at whether he needs to demand payment in dollars, euros or some of both.

Then, if the exchange rate starts to go the wrong way on him, he’ll buy derivative contracts as a hedge to lock-in a preferred rate.

What’s his latest prediction? Mr. Burnstein fears the euro the most.

He believes that over the next few years the dollar will get stronger and the euro will get weaker. That’s why he’s trying to make the tour through Europe now – before the euro declines further.

He also led the Red Hot Chili Peppers into an Australian tour when he felt the Aussie dollar would be strong.

Playing to the Beat of Strong Currencies

So basically, music concerns are no longer just dictated by where the largest fan bases are … now it’s important to know which audience has the strongest currency.

With this in mind, bands will almost certainly be planning more tours in South America, Southeast Asia and Australia.

Mr. Burnstein summed it up when he said, “We’re a U.S. export, the same way Coca-Cola is.”

Now, if you think he’s the only one doing this, you’re mistaken.

In fact, the promoters of the Rolling Stones and the Police, RZO Productions, do the same thing. In fact, they claim a “weak dollar is the best thing for American rock and roll.”

Well, I say that if a “weak dollar” is a great thing for rock and roll, then rock has a great future ahead of it overall.

The dollar may remain strong for now…but in the years to come, it will continue to sink like a stone.

Beware When Rappers, Rockers or Models Give Currency Advice

What do I think about rockers’ ability to judge currency movements? I think they’ve got as good of a shot at it as I do of building a house from the ground up.

After all, remember when rapper Jay Z was flashing wads of euros in his videos and when model Gisele was demanding to be paid in euros… it was about then the euro started to tank and the dollar began to rally.

So, I’m not going to start taking currency advice from rockers… but hey, I’ll listen to them sing. After all, I’m a fan of Lynyrd Skynyrd and the awesome Texas band ZZ Top. But I certainly wouldn’t go to any of them for currency advice.

Now that these guys are feeling so strongly that the euro has just about had it and that the dollar is going to strengthen… my advice is: Beware!

I think these guys are good for a contrarian indicator of what may end up taking place.

I’ll never forget when the Taj Mahal (India’s most famous monument; not the blues singer) decided the “dollar was no longer welcome”… that’s about when the greenback found a floor for a good while afterward.

So, when you hear people that are not involved in the currency market give strong opinions on where currencies are heading… watch out!

Have a Nice day!

Sean Hyman
Editor, Currency Cross Trader

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