Is the weakness of the US Dollar due in part to the out of control spending of the Bush Administration?

Question

A pound is currently worth two U.S. Dollars. What has caused this? I believe that it is due to the negligent overspending of this administration, what are your thoughts?

Answer 1

Yes, you are right that too much spending by the Bush Administration is one of the reasons of weaknesses of US dollar. The US adminitration spends too much and also taxes too much and finally borrows too much to spend. This is waste ful expenditure and causes prices to rise and affects the financial credibility of the US Govt. This makes the dollar weak. But there are many other reasons. The US household spends very high, saves very little. They import tooo much and are unable to export that much in value. So, they have to willy nilly borrow funds from the foreign countries. This contributes to the weakness of the dollar.

Answer 2

I would say that the weakness of the dollar is due to all the jobs and factories going overseas and also due to superior products being produced in the European Union. When I went to Europe last year, the Euro was like 1.36 to the US dollar, so it shows that the dollar is diminshing in value. I wouldn't disagree with the war in Iraq contributing to the diminishing value either.

Answer 3

The rate of government spending has only begun to affect currency values. The fundamental problem with the US economy has been long term lack of investment in value producing assets. All those factory buildings, mines, farms and research labs converted into Starbucks, Walmarts and Gaps.

Answer 4

I think so.The fed is expanding the money supply right now and bush is spending it like a drunken republican.

Answer 5

I think so