What is it that is making the U.S. Dollar drop in value? Do you think that the devaluation of the American Dollar is good for the rest of the worlds' economy?
Interesting question. First off I feel the need to say that the media is not reporting on this drop, keeping most Americans in the dark which is typical. The decline in the American dollar leads to a decline in purchasing power which leads to a decline in the standard of living. Any savings, investments, or annuities will suffer. This coming decline will impoverish almost 50% of white middle class and the other 40% will barely survive. Only 5-10% of Americans will prosper from this, because they know how to protect their assets. What causes this? Budget deficits, spending more tax revenue collected. Trade deficits is another causing factor, buying more imports then you can sell exports. Now that Bush Jr. is leading this country (god help us) the budget deficit is close to half a trillion dollars, along with trade deficits (one trillion dollars total). Little is being done to erect this situation so it will just keep getting worse. This will also have a tremendous impact on international trade. This fall is going to hurt a lot of people therefore I do not believe it is a good thing at all (even if others benefit from it).
The main cause of the dollar's declining value is our lopsided balance of payments/trade due both to our importing 14 million barrels / day of oil at $100 + /barrel (recently$127) and to our massive trade imports from China that have no corresponding exports.
A major solution will be to ramp up sustainable / renewable energy as a replacement for fossil fuels.
There is an excellent discussion of this by Nathan Lewis at
Enjoy - EnergyFred
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