What happened to the US dollar ?

Question

We are trading US and Canadian money at par up here -

That hasn't happened since the 50's

So whats going on down there -

Too many wars or what ?

10 dollars US now equals 10.71 US

1 dollar US equals 0.75 EU

Wow thats a sudden change

10 dollars US now equals 10.71 Candian is what I meant

Answer 1

1) Too much borrowing relative to savings rates: both personally & governmentally

2) Lack of maintainance of infrustructure

3) Oil rich countries changing, or talking about changing their policy of only accepting U.S. dollars for their oil. Moving, instead, to accepting only Euros, due to the U.S. making the oil rich countries angry through dysfunctional meddling & arrogant talk & actions.

4) Causing a loss of over $2 trillion to the U.S. economy by invading Iraq.

Answer 2

It is due to the bad economic administration of president bush. Too much money spent on the war. Then, the federal budget needs financing (the government needs money!), the difference between the imports and the exports from and to the world is getting bigger, when Clinton left the office... the government had a surplus in the budget.. now we have a huge deficit!. Also, the Fed has been incrementing the interest... making it harder to control the "houses' market". All of that makes the US dollar less effective. That's bad for the American living in another country... but it's good for the US exports. Thanks.

Answer 3

The USD is all fiat money. it is only worth what they can stretch out of debt. the only reason why people except it is because our Gov't says we HAVE too. the more people borrow, the more the our Federal Reserve can print, because they see the interest coming back and that is the real money. The politicians are Borrowing from the Feds too, they guarantee it on the labor of the people. Inflation is actually a tax.as long as inflation stays low, the dollars value based on the economy stays good. a good long war means a lot of borrowing. the feds collect the interest , keep that , and burn off the dollars that they printed out of thin air. The less dollars in circulation the more people want it the more the value goes up.we trade your money for ours wait 5 years sell it short and reap millions if not billions. and you go into a recession.
Remember inflation is loss of buying power. they gotta find a way to get it back. you would do it too. sorry.

Answer 4

That's a shining example the inflation tax. The presidents printing money to support all the wars, the entitlements, the disaster relief, the huge burocracies, and all the earmarks, causing the value of the dollar to depreciate. And as a result, we suffer, but we don't see the inflation as a tax.

Answer 5

I think every economist knows there are way, way, too many dollars in existence.
Through out history whenever too much money has been put into circulation a boom bust cycle occurs. The 1929 stock market crash was caused by too many {Unbacked by Gold}, dollars finding there way into stocks. When investors realized the dollar was not worth the 1/20th of an ounce of Gold it was supposed to be they sold stocks enmasse.

Much of Americas wealth is now backed by Real Estate. With the real estate bubble collapse-ing the U.S. dollar is losing value not only in America but world wide.

One of our Republican Presidential nominees, Ron Paul, has the economic knowledge to, hopefully, straighten out this current American economic mess.
He is advocating going back to the Gold standard as mandated in the U.S. Constitution.

Thanks for Your Question.

Answer 6

The dollar started losing any value in 1913 when it began the switch to fiat currency. It's "value" is arbitrarily set by the Federal Reserve, a private bank.

Answer 7

perhaps because of the fact there are already popular corruption already interior the country. it could additionally be a effect of the Oil Axis Powers that are the worldwide places of Iran, Kuwait and so plenty greater interior the middle East which targets to make the U.S. economic device somewhat fall. i think of the U. S. ought to declare a brilliant state of emergency because of the fact it somewhat is fairly a severe count and the Oil Axis Powers' aim are somewhat slowly being useful. 30 years from now, i think of Malaysia, China and Philippines could surpass US consistent with capita earnings.

Answer 8

Actually the dollar never left. It still offers the same quality of life to the working man but only as long as he works! The dollar will not be another Elvis.

Thank ya, thank ya very much.

Answer 9

Thats a very good question. The answer is simply this. Contrary to popular belief, the U.S. Dollar has not lost value. The Canadian dollar is gaining value faster. The world economy is just expanding faster the the U.S.

Answer 10

It has got to do with all the loans that Bush has gotten from his buddy at the World Bank and other outside countries. Most of these loans are at historically high interest rates and the global community is having a hard time believing that America can repay these loans on time.