OT: Pot calling the kettle black.
posted on
Jan 11, 2008 07:11AM
The US dollar is going down in value.
Some argue that it will not go down much further because as it goes down US produced goods get cheaper to the rest of the world. They buy, dollars return and therefore correcting the dollars devaluation.
What they forget, or deny, is that as the dollar goes down everything that is imported goes up in price ( oil is a prime example) and more dollars go out.
It is a balance between exports and imports, unfortunatelly due to the debt to the foreigners and the interest paid on that debt the outflow of dollars overwhelms the inflow and makes it difficult to restore the exchange into balance.
Yesterday I was watching the Tonight show (Jay Leno) where a guest was from a stock exchange and this woman was constantly referring to one half of the above scenario but completely ignoring the other. Her main theme was - Don't worry the lower dollar is good for it increases our exports. Jay, the gentlemanly host, seemed to see through that discrepancy.
Some of these folks live in a cocoon and try to persuade others into the same line of thinking. They also accuse China of manipulating their currency to keep it low while the US would never manipulate theirs to keep it from plunging.
That is why gold will go to $1000 shortly and $2000 soon there after.