2009 could the first global recession since the 1930s, according to a UN report. But John Crooks says forex traders can use the economic slump to make big profits. He picks four currencies that will be “on the chopping block” for 2009.

This from The Sovereign Society:

The U.N. is predicting the first worldwide recession since the 1930s … for 2009. If that wasn’t bad enough, developed nations are supposed to shrink up to 1.5%. “It seems inevitable that the major countries will see significant contraction in the immediate period…even if the bail-out and stimulus package succeed,” according to the report. In other words, the recession may have spared Black Friday 2008, but next year, the worldwide recession will cut into worldwide spending even further. In the currency markets, you can already see that four currencies will suffer next year as the U.N.’s prophecy comes true…

The Four Currencies On the Chopping Block for 2009

1. Euro: Yes, the euro WAS King of the Hill for the most of this decade. But those days are long gone. Right now, the Eurozone is only as strong as its weakest members – and some of its weakest members happen to be suffering emerging markets in Eastern Europe. Not to mention, the European Central Bank has already started following the Federal Reserve in slashing their own interest rates. And, just last week the European Commission urged all EU member states to unite in an EU-wide fiscal stimulus package worth 200 billion euros (US$260 billion) to stave off recession. That spells disaster for the single unit currency.

2. Pound – The London markets have been the most overexposed to the subprime-credit crunch for quite some time. In fact, the pound started to turn as early as November of last year. Today, a year later, the pound is still suffering for the same reasons – deteriorating housing wealth, frozen credit market and heavily indebted consumers, among other sore spots. The U.K. labor market (especially in London) is also still at risk from financial-specific job losses (even after massive layoffs this year). And, the Bank of England too is racing to catch the Fed in lowering interest rates to stem the economy’s collapse.

3. Australian dollar – Australia has been a satellite country to China for years. Australia is used to providing so much of what hungry Chinese manufacturers need to produce their “stuff.” But if China further cuts back their demand for such input products and commodity prices continue to drop, then Australia will lose the financial boost of its best customer. In other words, Australia’s exports will suffer mightily and crush the Aussie dollar even further. If that’s not bad enough, the Reserve Bank of Australia is on a similar path with monetary policy. As it is now they can’t seem to cut interest rates fast enough.

4. South African rand – The ramifications from a sick global economy will reach beyond just the major currencies. Whether South Africa’s economy lives or dies is based largely on their commodity exports. And as commodity prices continue to drop next year, which we think they will, the South African rand will suffer even more. Plus, economic troubles will likely rekindle political and social unrest. Right now jobs are at risk in South Africa, so many South Africans could face the constant threat of unemployment. Of course, a rising jobless rate doesn’t sit well with a nation’s citizens. And civil unrest doesn’t exactly reflect well for the body politic. (A situation like this doesn’t bode well for any currency.) But as you’ll see, you can use economic slowdowns the coming 2009 recession to grab never-before-seen profits in the Forex market.

Source: Recession Will Kill These Four Currencies In 2009