10-20-2007, 12:12 PM
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#22
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Guru
Join Date: May 2002
Posts: 40,410
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To Janett::
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Originally Posted by dude1394
Sure there has also been speculation but that is an ebb and flow, not a constant uptick, in fact sometimes the speculation will push prices the other way.
Absolutely high oil prices hurt our economy, who's ever said differently? So what are the other reasons that the big boogey-man has done?
How does a low dollar necessarily hurt our economy?
Care to actual put some thought behind these koskid posts?
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In my continuing quest to educate you janet I present some more information to you on a weak/strong dollar. Again back to what has become my fav blog, backtalk.
http://engram-backtalk.blogspot.com/...k-economy.html
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As I have said before, though, one should not really talk about a weak dollar vs. a strong dollar (because "weak" sounds bad and "strong" sounds good). Instead, one should talk about an "export-encouraging/import-discouraging dollar" (what others call "weak) vs. an "import-encouraging/export-discouraging dollar (what others call "strong"). In light of our large trade deficit, it is good that we now have an export-encouraging/import-discouraging dollar:
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Thursday, 11 October 2007
US trade deficit narrows further
The US trade deficit narrowed more substantially than expected in August as export levels rose to a monthly high while imports fell.
It fell 2.4% to $57.6bn (£28.3bn), the lowest monthly shortfall since January.
The politically-sensitive deficit with China narrowed by 5.3% to $22.5bn as the US sold more aircraft and soybeans while China sold fewer computers.
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The deficit for the first eight months of 2007 totalled $708bn, down 6.7% on the corresponding period last year.
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"The trade deficit is smaller than expected on a weaker dollar," said Michael Woolfolk, senior currency strategist at the Bank of New York Mellon.
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Well, you can call it a "weaker" dollar, but that's not really the best term. In reality, it is an export-encouraging/import-discouraging dollar, and that seems like a good thing. It means that interest rates are low in America (as they have been for a long time) and are expected to stay that way for a while. It also means that companies in Europe that depend on exports to America are going to suffer. Unfortunately, though, everyone seems to think that a "weak" dollar means a weak economy. It's not true.
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