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  • raybans2 raybans2 Feb 5, 2013 1:57 PM Flag

    Currency Wars

    Ok, so what you are trying to tell us is Obama has encouraged the Fed to print worthless dollars so that he can address the trade imbalance and that all the other contrary reasons that are being given to us by the Fed are just smoke and mirrors.

    I think you miss the point. There are much higher priority reasons for the Feds actions and even if they were aware of the spillover affect into currency valuation, which I am sure the Fed is, it is a coincidental side effect. Trust me, if it were to have caused the dollar to be stronger instead and thus worsen our trade situation, they would continue to print worthless dollars anyway. Obama has shown almost no interest what so ever in trade policy unless it impacts the health of the green companies that the US government has invested in because that is personal. The rest of the country could sink for all he cares.

    The health of our economy today, or the lack of it, is more closely tied to the currency manipulation by our trading partners than it is tied to anything else. The problem is that Obama doesn’t seem to notice this. It’s barely on his radar. He pays lip service to the issue but takes no effective action that would have a discernible impact.

    You should be concerned about this as it is all of our jobs that are leaving the US. This is not a Democrat or Republican issue. It is a matter of self preservation for us all. Even if you are in business for yourself you won’t have customers to sell to if those customers have no money to spend.

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    • RayB ... you said:

      "Obama has shown almost no interest what so ever in trade policy unless it impacts the health of the green companies that the US government has invested in because that is personal. The rest of the country could sink for all he cares."

      First, do you now want the government involved in the business of the U.S. as a matter of policy?

      Secondly, as far as caring goes, how's about the auto industry? I think it was the Repubs that wanted to let the car companies fail.

      Thirdly, BO has made it clear that he thinks some infant industries need a jump-start from the gov't. I suppose you are against this? What would you do then to help business? Could it be reduce taxes?

    • Over the long term the major determinant of exchange rates is Purchasing Power Parity. In the short term there is more than one way to purposely affect currency valuation.

      I also watch McLaughin (almost like a religion) and heard Mort state that it was the president's policy. Buchanan's jaw dropped and he asked Mort for clarification. Even donkey tattooed Eleanor Clift (has ears inside the whitehouse) admitted it was his policy and she said a wise one at that.

      • 1 Reply to mmichaelr
      • You have confirmed that I was right. The fact is that Obama is spending money is for reasons that are not remotely related to the dollar's valuation and how that impacts trade abroad. The implication of your statement is that he would stop this reckless spending if it was impacting the valuation of the dollar in a way that would negatively impact our balance of trade and I can state with 100% certainly that he would not stop if this was the case. The fact that it does impact the valuation of the dollar is completely unrelated to the primary goal of his policies and any undesired dollar valuations would not sway his spending resolve in the least. He would spend regardless of what happened to the dollar valuation. It is simply coincidental that a debasing of the dollar makes our products more competitive abroad.

        And by the way, the reason they are cheaper is because the debasing of the dollar gives everyone in the country a pay cut relative to our trade partners. As a result any natural resources we buy from abroad will be more expensive to us. This is not a bad thing because if people in the US were not getting paid too much we would not be losing our jobs to our trade partners. It is a double edge sword though. Either you make less or you make nothing at all. The choice is clear.

        What I don’t like is government employees acting like they can be immune to this inevitable reduction in our standard of living by elevating their wages at our expense. So not only do we get paid less relative to the cost of resources, we pay higher taxes as well so that government employees can continue to live a life style that we cannot. This kind of predatory behavior needs to be stopped. The taxpaying public cannot be looked to as a source of revenues to be exploited by those who are in a position to influence government spending. It is not right to elevate the standard of living of some at the expense of others.

        It is often said that the US is declining as an economic power. I personally believe that much of the source of this decline emanates from federal, state and local governments. If it were not for this predatory behavior we would be in a much better competitive position. How many parasites can a host support before it starts to wither and die? Right now the US is in a state of fever and it seems our national immune system is losing the battle.

        I did not know that Obama was already trying to convince people that this was his policy however I knew that he would do this eventually because I think I understand him pretty well. It fits. Thanks for the heads up. I may never have heard this if it had not been for your comment. I just need to verify it now. Some people make this stuff up just so they can feel right or they hear things differently than what was actually said because that is what they wanted to hear. But I would not put it pass him to do this so it is my tendency to believe it until I determine otherwise.

 
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