lawrocket 3 #1 November 12, 2008 You know, in the past several months I've seen SEVERAL posts mentioning a couple of horrible signs for the US economy: 1) the price of oil; and 2) the decline of the dollar. Back in June 08, the Euro was at about $1.60 - an all time high. Now, it is about $1.25. It hasn't been that low since Fall 07. And right about where it was in Dec. 04. And let's look at oil. It's lost about 60% since july (from $148 to $58). Now, is cheap oil and a strong dollar a sign of a strong economy? It does not appear to be so. My wife is hotter than your wife. Quote Share this post Link to post Share on other sites
TomAiello 26 #2 November 12, 2008 Calling the dollar "strong" is a little misleading. The reason the dollar is back up relative to other currencies is that the other currencies are now "weak" as well. The US fundamentals haven't improved--it's that everyone else is declining now, too.-- Tom Aiello Tom@SnakeRiverBASE.com SnakeRiverBASE.com Quote Share this post Link to post Share on other sites
lawrocket 3 #3 November 12, 2008 The rest of the world is lagging. But - strebgth of currency is determined by comparuson. It is a zero-sum game and an indication that things may be worse elsewhere. so much has been harped on about oil and the dollar. What the hell has the government done to lower the price of fuel or improve the exchange rate? Pretty much nothing. My wife is hotter than your wife. Quote Share this post Link to post Share on other sites
TomAiello 26 #4 November 12, 2008 Quoteso much has been harped on about oil and the dollar. What the hell has the government done to lower the price of fuel or improve the exchange rate? Pretty much nothing. The primary thing that the government could do to strengthen the currency is to stop spending money it doesn't have. Unfortunately, this is politically inexpedient, so everyone pretends that we can somehow make the problem (too much debt) go away by spending money we don't have and calling it "stimulus" or "bail out" or "foreign policy" depending on who the folks wanting the loans are.-- Tom Aiello Tom@SnakeRiverBASE.com SnakeRiverBASE.com Quote Share this post Link to post Share on other sites
kelpdiver 2 #5 November 12, 2008 QuoteThe rest of the world is lagging. But - strebgth of currency is determined by comparuson. It is a zero-sum game and an indication that things may be worse elsewhere. People oversold the dollar early in the year. When it became apparent that the EU wasn't really any better off, many returned to the 'relative safety' of the dollar. Oil was inflated both by the currency, and by a bit of speculation. And Americans actually cut usage. But neither change really erases the underlying pains we're dealing with right now. But with any luck, we can avoid more stagflation. Quote Share this post Link to post Share on other sites
kallend 2,229 #6 November 12, 2008 QuoteQuoteso much has been harped on about oil and the dollar. What the hell has the government done to lower the price of fuel or improve the exchange rate? Pretty much nothing. The primary thing that the government could do to strengthen the currency is to stop spending money it doesn't have. Unfortunately, this is politically inexpedient, so everyone pretends that we can somehow make the problem (too much debt) go away by spending money we don't have and calling it "stimulus" or "bail out" or "foreign policy" depending on who the folks wanting the loans are. Maybe we could package up the debt into worthless investment instruments, get Moody's to give them a AAA rating, and sell it to the Chinese. Oh -wait a minute...... The only sure way to survive a canopy collision is not to have one. Quote Share this post Link to post Share on other sites
TomAiello 26 #7 November 12, 2008 QuoteMaybe we could package up the debt into worthless investment instruments, get Moody's to give them a AAA rating, and sell it to the Chinese. Oh -wait a minute... And then, when we can't pay off our debts, we should complain that it's not fair, and ask the UN to bail us out, because we are too big to be allowed to fail.-- Tom Aiello Tom@SnakeRiverBASE.com SnakeRiverBASE.com Quote Share this post Link to post Share on other sites
Andrewwhyte 1 #8 November 12, 2008 Quote Now, is cheap oil and a strong dollar a sign of a strong economy? It does not appear to be so. Cheap oil will help create a strong economy, but expensive commodities are the sign of a strong economy. Quote Share this post Link to post Share on other sites
