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Why is the Bush administration pursuing a weak dollar policy?
I understand that a weak dollar favors imports, but it seems as though a weak dollar is also detrimental to just about everything and everyone else. Can someone knowledgeable please explain to me the different mechanisms by which the current administration is pursuing a weak dollar policy and the goals that the administration hopes to achieve through such a policy? Thanks!
Public Comments
- a weak dollar doesn't favour imports... it makes it imports more expensive and so imports should go down.. The bush administration has always thought its dollar was too high, esp compared to China which it believes to have an artificially low currency. A lower US dollar should decrease imports and help re-balance the biggest balance of payments problem in the world by decreasing foreign imports and boost US exports to the world.
- This is just my view of what you are talking about. I think that the Weak Dollar Policy will probably be more favorable for imports because other countries will purchase more goods for a cheaper price. Also a lot of Canadians and Europeans come to the U.S. just to shop because of the exchange rate. Also I saw an article a few weeks ago that said a lot more foreigners (especially Europeans) are purchasing homes in the U.S. But I don't see how it is going to help because basically America is just selling itself cheap to every other country that has a higher exchange rate. In my personal opinion, I think that America needs a Democratic president to clean up what Bush messed up. I can't wait until Bush is out of office this year. The Democrat nominees are all about protecting the middle class and tax cuts for the middle class, and the Republican nominees are still talking about tax cuts for the wealthy. The Middle class is the main foundation of a country not the wealthly.
- The only thing the Bush administration has done well is to make the Bush family very wealthy. Remember, they are in the oil business and with oil at $100.00 a barrel their fortune has been tripled, at least. No, George doesn't worry about the strength of the dollar, he has his.
- Only detrimental if we as we have been doing for ever purchase cheap foreign imports. It might just stimulate US manufacturing again.
- Its not a problem of Clinton or Bush this is our national problem Weaker dollar means less imports and more exports. Since industrial revolution, we increased our productions compared to other nations( except developed European countries) and our dollar gains a good value in the market. We maintained this until Globalization. Globalization means flow of wealth from richer countries to poorer countries. Because of our high wages and high dollar value, products made in poor countries are cheap. So we keep on buying goods from other countries. ultimately we closed our production units. Today we have only 11% prodution units compared to post WW I I. More imports and less exports developed foreign debt. As on today we have 9 trillion dollars ( 9,000,000,000,000=00) of foreign debt. So our dollar is going down. This is beyond control. Now there is no choice. . Its easy to understand in the year 2000 we were getting 1.21 euros for dollar. But right now we are getting only 0.68 euros. Means If we have 100 dollars in year 2000 right now that become worth only 56.19 dollars. Means we lost so much wealth already compared to other nations. . No one exactly know what will going to happen. Because this is depression of all world driven by US. Countries like China, Japan, Canada, Mexico and German may suffer more next to our country. now china currency is fixed ( pegged) with US $ . If in case china take out the pegging means if their currency keep floating, we start to feel more sever depression. we may not afford to buy made in china goods. We have to start our closed prodution units back. As per me this date may fall in 2008. Because of weak dollar china is loosing a lot. It buy raw material and oil for more money and sell goods to us for less money . Its loosing money to keep their and US economy running. Now everything is beyond control. Nobody can control or prevent us from going depression. We dont have any chance to escape from this. As we are super power the exact impact of depression is getting postponed. The only way left is to save yourself no use of blaming.
