Dollar is going much much lower, too. By forcing the Chinese Yuan to appreciate, Bush is hoping that Chinese demand for US products will perk up too. Of course, only about 5% of Americans ever think that our own currency can be affected by forces from outside of our country. They don't realize that the value of the $ has a profound effect on our own economy, and be leveraging ourselves to the limits, it isn't good for our economy in the long term. Keep on drinking the Kool Aid, kids.
my point was that short term losses in the dollar are indicative of what the market thinks about our future, post election. ie..the market isnt happy about the election.
The value of the US$ has to do with what the value is versus foreign currencies, it can't be by itself in a vacuum. The dollar dropped because investors think that there is more value in foreign currencies, sell dollar, buy FX. It also has to do with current interest rates and Americans propensity to borrow. My point is that the dollar dropping has more implications and reasons than people just not liking the election.
Anon: I agree, the dollar can not be taken in isolation, but the outside environment is not that favorable with non-hedonically adjusted growth in the UK and the EuroZone coming in damm low, and the Japanese at stall speed. So the dollar fall is most likely not due to the stronger current performances of the other economies which print hard currencies. The other option is that the long term projected growth path of the US double deficits(federal and trade) will not get any better. Seeing that George Bush believes that his tax cuts should be made permanent, and that the GOP controlled Congress has been busting any semblence of spending restraint (see Medicare drug benefit, see ag. subsidy bill) and that the US will be paying for military operations in Iraq and Afganistan for a long while, it is a safe(r) assumption that the US will not exercise the political will to be fiscally responsible in the near future, so the harder realities of responsibility will be coming into play by decreasing the living standards of Americans by raising import prices.
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Dollar is going much much lower, too. By forcing the Chinese Yuan to appreciate, Bush is hoping that Chinese demand for US products will perk up too. Of course, only about 5% of Americans ever think that our own currency can be affected by forces from outside of our country. They don't realize that the value of the $ has a profound effect on our own economy, and be leveraging ourselves to the limits, it isn't good for our economy in the long term. Keep on drinking the Kool Aid, kids.
my point was that short term losses in the dollar are indicative of what the market thinks about our future, post election. ie..the market isnt happy about the election.
The value of the US$ has to do with what the value is versus foreign currencies, it can't be by itself in a vacuum. The dollar dropped because investors think that there is more value in foreign currencies, sell dollar, buy FX. It also has to do with current interest rates and Americans propensity to borrow. My point is that the dollar dropping has more implications and reasons than people just not liking the election.
Anon: I agree, the dollar can not be taken in isolation, but the outside environment is not that favorable with non-hedonically adjusted growth in the UK and the EuroZone coming in damm low, and the Japanese at stall speed. So the dollar fall is most likely not due to the stronger current performances of the other economies which print hard currencies. The other option is that the long term projected growth path of the US double deficits(federal and trade) will not get any better. Seeing that George Bush believes that his tax cuts should be made permanent, and that the GOP controlled Congress has been busting any semblence of spending restraint (see Medicare drug benefit, see ag. subsidy bill) and that the US will be paying for military operations in Iraq and Afganistan for a long while, it is a safe(r) assumption that the US will not exercise the political will to be fiscally responsible in the near future, so the harder realities of responsibility will be coming into play by decreasing the living standards of Americans by raising import prices.
Keep up the good work »
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