Comments on: The U.S. Federal Reserve has Perfected the Incredible Shrinking Dollar http://www.theundergroundinvestor.com/2006/12/07/a-the-incredible-shrinking-dollar/ The definitive investment blog for investment news not discussed in the mainstream media Tue, 06 Jan 2009 23:00:57 +0000 http://wordpress.org/?v=2.7 hourly 1 By: J.S. http://www.theundergroundinvestor.com/2006/12/07/a-the-incredible-shrinking-dollar/comment-page-1/#comment-39683 J.S. Sat, 20 Sep 2008 02:37:12 +0000 http://www.smartknowledgeu.com/blog/2006/12/07/a-the-incredible-shrinking-dollar/#comment-39683 It's two years later now and the dollar has lost tremendous value against a basket of other major global currencies now, particularly the Euro and the Pound (even with the recent rally). The death of the dollar has nothing to do with a political agenda. If one understands monetary policy of the U.S. Federal Reserve, it was blatantly obvious the dollar was going to weaken considerably two years ago just as it is obvious today that, in light of these massive bailouts of financial institutions, it will continue to weaken significantly. It’s two years later now and the dollar has lost tremendous value against a basket of other major global currencies now, particularly the Euro and the Pound (even with the recent rally). The death of the dollar has nothing to do with a political agenda. If one understands monetary policy of the U.S. Federal Reserve, it was blatantly obvious the dollar was going to weaken considerably two years ago just as it is obvious today that, in light of these massive bailouts of financial institutions, it will continue to weaken significantly.

]]> By: none http://www.theundergroundinvestor.com/2006/12/07/a-the-incredible-shrinking-dollar/comment-page-1/#comment-717 none Sat, 09 Dec 2006 23:17:16 +0000 http://www.smartknowledgeu.com/blog/2006/12/07/a-the-incredible-shrinking-dollar/#comment-717 Well currencies can rise and fall at the drop of a hat and any whiff of investor panic. In reality I don't think there is any real non-emotionally based reason why the dollar should decline significantly. American companies are reasonably competitive. A 30% drop on dollar value implies a massive competitive edge which in turn would drive significant capital investment and a rehardening of the exchange rate. Most of the "dollar is going down" criticisms are emotionally and politically based, driven by the desire to see both a weak dollar and a faltering economy. Long term (unless the capitalist economy is reformed) you can't get both because a weak currency stimulates the economy. Well currencies can rise and fall at the drop of a hat and any whiff of investor panic. In reality I don’t think there is any real non-emotionally based reason why the dollar should decline significantly. American companies are reasonably competitive. A 30% drop on dollar value implies a massive competitive edge which in turn would drive significant capital investment and a rehardening of the exchange rate.

Most of the “dollar is going down” criticisms are emotionally and politically based, driven by the desire to see both a weak dollar and a faltering economy. Long term (unless the capitalist economy is reformed) you can’t get both because a weak currency stimulates the economy.

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