Confederate money, your best investment
Dollar falls to six-week euro low on election jitters – MarketWatch — Before GW Bush the Euro was worth 80-cents. Yesterday it cracked $1.28. So what would have effectively cost you 80-cents now costs you $1.28 if it comes from outside the USA. Since we are net importers we’re essentially going broke.
In New York trading, the dollar was quoted at 117.44 yen, compared with 118.28 yen late Monday. The euro changed hands at $1.2801, compared with $1.2720. It had earlier risen to $1.2819, the highest level since Sept. 25.
From a Canadian standpoint, it’s a relief. Because of our comparatively sparse population most things are 20-100% more expensive here than in the USA. On top of that we get hit with enough taxes to make your eyes water. Your lower dollar is making USA products very affordable which should eventually be a good thing for you.
It’s a shocking travesty what we’ve let these charlatans do to our country. I’m not crying in my beer though. Dollars are for idiots. If our voters and politicians insist on taking this country down, well so long.
Seeing this coming, I invested in bonds in Euros. In addition to the interest they pay (in Euros), they’re now worth, as John says, about 60% more than just a few years ago.
Now the declining dollar might have improved the trade balance as American goods got cheaper overseas, but we’ve simultaneously destroyed “brand America” with our beligerent foreign policy and bellicose delusions of superiority. Besides, we don’t manufacture any more. You might have noticed, our trade balance has not improved a bit. It has worsened.
I’m not pleased to be betting against my home currency, but I’ve consistently voted against the fiscal irresponsibilty that is taking us down.
Hey, everyone! VOTE THESE DESTRUCTIVE CLOWNS OUT NOW! We can’t afford this dangerous decline, and the 9 trillion dollars we’ve borrowed from our children will be a crushing burden as they try to rebuild this weakened country.
I might have to come for a holiday.
🙂
Damn, why does this have to happen when I’m broke? I want to order all sorts of stuff from the States and pay with ultra-valuable €s!
While I have a fair amount of respect for Canada and Canadians, I have to admit, I spent my adolescence growing up waiting for the Canadian economy to finally take the piss. I lived about ten minutes south of the B.C. border in a rural ghetto whose principle economy revolved around Oil, Aluminum, and Canucks in hurkin’ RV’s who came south to shop at the local K-Mart when the dollar was on par.
I don’t see the federal or trade deficits (nor the weak dollar) to be an especially partisan issue, although I’ve officially run out of patience with condescending right wingers whinging about the democratic tax-and-spend stereotype. It remains that one is much safer pretending to salvage Medicare than to address the feds’ current credit card debts publicly. Minus the the fact that we keep sending our dollars overseas to buy more plastic and our suppliers keep banking them and not buying American crap, we owe just a heck of a lot of money — I once figured it as roughly equivalent to saying that every working American would have to kick down something like 22 large to pay off their share free and clear, but the punchline is that the money would have to be earned in addition to whatever income they might have expected to net during the same period if they hadn’t paid off the mortgage.
Ross Perot was, indeed, one of those fruit loopy things, but he was also very deadpan about the fact that paying down the federal deficit and getting out of debt was an issue equivalent to being the deciding vote that reinstates the draft for any politician that wanted to be real about the subject. I once heard an economist equate America’s success in the marketplace to being roughly the same as producing new wealth in the range of Belgium on an annual basis, but in essence, that’s kind of fallen down into the outhouse, since debt production out paces it by a bit these days.
Given these considerations, the thing to do is stop and do a quick head count of the number of officials who’d like to take up the subject of raising taxes and repealing some of the tax cuts made prior to this point in order to pay down this tendency to throw a few billion at terrorism every few months. If you strain your ears above the din of the crickets, you can almost hear someone on DailyKos whining that the necessity of raising taxes after the dems win the 08 election will reinforce people’s stereotypes about them while giving the people who ran up the debt a pass since they’ve already left office.
Since more of the same is pretty much a given, the only thing I want to know is where the money guys figure they’re going to go after they’ve run the economy into the ground and the US is officially declared a third-world nation. Something tells me that we won’t be especially welcome in Dubai.
To be fair – this is also because the Euro and the Pound have shown really good growth. More so the pound, but the Euro has been steady after a very shaky start.
And the Chinese are holding the Yuan down to ab’t 5% annual rise against the U.S. dollar.
What’s Bush’s response? He wants it to rise faster and his pimp at the Treasury whines about the Chinese “saving too much money!” They should learn to spend like Americans!
Wow. You liberals will jump in any thread to try and make a point. Too bad you always fail.
The value of the dollar is being supressed to encourage foreign investment, and continued integration of the Canadian, Mexican, and American economies. I am not enough of an expert on the subject to say if that’s good or bad, but that’s what’s happening. The leap of saying “we’re going broke” can’t be backed up with fact.
The value of the dollar is being supressed to encourage foreign investment
Yeah, and we’re fighting terrorists there so they don’t come here. Stop or you’re going to get dizzy spinning that fast. 🙂
I think it’s more accurate (and spin-free) to say that Americans just don’t understand what the deficit means and how it impacts the economy long-term. Politicians do know that, but they don’t care about tomorrow because none of the deficit trouble can be blamed on them when we finally have to deal with it. In the meantime, they spend themselves silly.
Should the R’s be called The Borrow and Spend party?
#9.
Yeah – and dubya is just a sleeping genius just waiting to save the world with his magic supply-side butt gas.
“Help the poor to feed themselves and you just get more poor. Give a rich man money directly out of the taxes taken from the poor and you get a contributor for a life time.” – republican party
“Some call you rich. I call you my people.” – dubya 2004
“Stay the course in Iraq” – “I will stay the course in Iraq regardless of what others say” – typical dubya Iraq quotes until October 2006.
“I never said stay the course” – dubya oct 2004 George Stephanopoulos interview.
#11 – correction that was the oct 2006 Stephanopoulos interview.
Those are the best replies you guys can come up with? You lose.
yeah ok so the dollar is falling overseas… so what?
The USA isnt the stongest economy out there, thats basically what it boils down to. and the reson? US foreign policy sucks. U want a better exchange rate? – Then fix foreign policy.
As long as the Chinese keep taking our funny money, we’re still in good shape. The last I heard their foreign reserves were up to a trillion dollars. Heaven help us when they decide to start spending it.
Without the oil trade being done with the dollar it would be worth next to nothing. If it keeps dropping in the fashion it is now i guarantee the opecs will shift over the the euro. Then your gona be really screwed.
“Besides, we don’t manufacture any more. You might have noticed, our trade balance has not improved a bit. It has worsened.” –Actually America still manufactures a large amount of goods, but as we continue to evolve into a service based production model the manufacturing sector will take a hit. The trade balance? The measurement you should be looking at is the amount of FDI into America which has been stellar under this administration. If you are upset about the trade imbalance stop buying foreign goods, and get you’re friends on board.
“Damn, why does this have to happen when I’m broke? I want to order all sorts of stuff from the States and pay with ultra-valuable €s!” Green Dreams wouldn’t this type of foreign-consumer attitude help American manufactures?
“What’s Bush’s response? He wants it to rise faster and his pimp at the Treasury whines about the Chinese “saving too much money!””– The President’s response has been rather rational, as the Chinese currency is undervalued and the PRC has made efforts to correct this matter. His “pimp” at the treasury? That doesn’t even deserve a rebuttal.
Sounds The Alarm you didn’t even address the issue of the dollar losing value, you just used this as an excuse to copy and paste quotes from moveon.org
“I think it’s more accurate (and spin-free) to say that Americans just don’t understand what the deficit means and how it impacts the economy long-term.” Baggins please enlighten us on how it does impact the economy in the long-term.
Mr. Dvorak, is this currency move a surprise to anyone? The EU as a whole has had steady, somewhat lackluster, performance over the last six years, helping to stabilizing and appreciate the value of their currency. The constraints of the Growth and Stability Pact, along with the ECB’s fear of inflation, has helped keep the currency on track. If one was to look at the value of a dollar/euro over the past six years it hit a high of 1.0334 dollar/ euro and hit bottom at 0.8225. That type of volatility is cause for concern?
James…note that the last really big US economy coincided with a massive debt paydown. King Bush I had to renege on his ‘no new taxes’ promise to make that happen. We are currently going the wrong way, which means the economy is going nowhere but worse. It will improve significantly when we decide to pay off the debts the current congress has built up, just like before.
And FWIW, trickle-down economics is a lie. Or maybe more understandable to a right-winger, it’s a theory. 🙂 IMO it’s actually just payoff to big contributors.
Here, James. Have a Midol. In fact, take two, they’re small.
If there’s no federal or trade deficit in James Hill World, about all I can really do is point out that the census still counts a population totaling exactly you. Then again, someone seems to have convinced you that devaluing one’s currency in the interest of selling debt to foreign interests is a good thing; I’m not so sure many here would be too jazzed about seeing investment return to 1990 levels, when we took in so much foreign investment from Saudi Arabia that people began to wonder if foreign investors wouldn’t end up with majority control in US interests.
But let’s assume that we’ve developed the grinding need to manipulate the value of our currency in order to bring in dollars from overseas companies and overlook that it cost eighty cents on the dollar to get it. If so, then the cumulative product of this strategy has been that we’ve dropped from a rough FDI of 380,798 billion in 2000 to an FDI of 60,761 in `03 and as of last year, had only brought the total back up to 133,265. It may yet be that the total foreign direct investment in the US will return to some kind of equilibrium in the foreseeable future, but A) Most people would probably look at the result and figure the strategy left something to be desired and 2) quite a bit of money has hemmoraged in the last five or so years by these figures, and respective of the merit of the scheme itself, if the lay individual were to suspect that the devaluation of our currency had something to do with a drop in it’s value relative to other currencies instead of thinking it was merely some clever machination on the part of the fed, well?
They could be as ignorant as dirt and mistaken as a man who”s eaten a box of suppositories and not spend as much time spouting partisan BS about how everything you disagree with is just partisan BS.
Feel free to ignore the fact that I extended you the benefit of the doubt and presented an opposing view supported by something more than rhetoric, but seriously. Find another tune. Even if everyone here was as vapid and cardboard as you seem to assume, you’ve long since started to make people think you’re just projecting.
Just because its from move on, does it make anything said untrue?
The republican’s have a problem with the truth.
Take your time USA. I still have lots of things to buy.