LaniRawson944
That was then. As of November 11, 2007, Veterans Day right here in the U.S., the euro is worth 1.46 American dollars. A single euro now buys...
Considering that its creation in 2002, the euro ----a Frankenstein creation that replaced the former currencies of 12 European countries like France, Germany and Italy--- has beaten the socks off the American greenback. Back then, the euro limped out of the gate at a parity with the greenback. It rapidly dropped to around 86 cents for every single dollar.
That was then. As of November 11, 2007, Veterans Day here in the U.S., the euro is worth 1.46 American dollars. A single euro now buys 46% a lot more than its American peer.
Weve scratched our heads in this column about the decline of the dollar. Whats taking place now is unprecedented.
The dollar has fallen to a 26-year low against the British pound. It has fallen to a 33-year low against the Canadian dollar.
What has occurred to put the dollar in a no cost fall / Throughout the final century, every American President and every American Treasury Secretary has repeated the mantra that a robust dollar is American policy. As not too long ago as October 10, two weeks just before the G-7 Summit, each the current President and the existing Treasury Secretary recited the mantra by heart.
I really feel extremely strongly that a sturdy dollar is in our nations interest, stated Treasury Secretary Henry Paulson, formerly Chairman of Goldman Sachs.
Whats missing is the and for that reason. In the previous, extreme drops in dollar values have brought strong corrective actions, a get back of the dollar in effect to prop up the value. No such cavalry charge is coming in the existing climate. In reality, some have suggested that the present U.S. policy is a smug contentment that the decline of the dollar has boosted US exports by about 15%, because our exports are now more affordable for foreigners.
Which leaves all of us to wonder aloudwhat takes place if the dollars no cost fall continues? Is there any safety net down there?
Dont bet on it. Secretary Paulson ha began adding a caveat to that ol powerful-dollar mantra. and we think that currency values must be set in a competitive marketplace based on underlying financial fundamentals.
Those underlying fundamentals are weak now in the U.S. A mortgage industry meltdown, coupled with an economic climate strained by the $576 billion price of war have all but tapped out the U.S. economic climate for the time getting. We are now in hock. We are the largest debtor nation on earth.
And what happens when we take out some of our retirement in the form of these weakened dollars? A hidden costs of letting the dollar sink is that the acquiring power of those retirement savings ---as soon as they are converted to dollars is acquiring fairly pitiful. Worsening the predicament is that, as opposed to many citizens of foreign nations, Americans who want to maintain their money in euros uncover quite couple of US banks supplying that flexibility. Some German banks (Deutsche Bank) and on-line banks (everbank) have begun providing accounts to Americans denominated in other currencies.
Brother, can you spare a euro?
See The Amazing Shrinking Dollar, www.collectivewizdom.com
