When will American consumer feel the pinch in the wallet from the dropping dollar?

Question

Canadian dollar closed at 1.02 yesterday, they predict it will be 1.05 by Jan but those are the same people who predicted parity by Jan.

Cars, gas, electronics, etc are some things consumers buy from other countries, when will the prices rise to reflect the weak dollar?

Answer 1

Americans have not yet felt the full effect of the falling dollar, because most consumer goods come from countries whose currencies are managed to not appreciate much against the dollar - China, much of Asia, much Latin America, etc.

Eventually, when those countries feel the benefit they receive from maintaining artificially low currencies (access to increasingly tapped out US consumers) no longer exceeds the costs (increasing inflation, social unrest, large exposure to the falling dollar), then they will allow their currencies to appreciate and the dollar will fall more sharply.

When will it happen? Asian countries have talked for years about a future without the US as their primary market, and about shifting reserves away from the dollar. But - just as the US has talked about increasing the savings rate - it has been (mostly) just talk and little action. So the eventual adjustment is more likely to be sharp rather than managed, and will probably be touched off by some unexpected event.

As someone who lives in Asia, I don't think Asian countries will be able to maintain artificially low currencies beyond 2010 - they fuel too much inflation, and will ultimately cause social unrest. When an adjustment occurs, American consumers, as well as low wage Asian workers, will feel the pain immediately.

Answer 2

Right now, that Canadian Lumber is expensive. But luckly there is cheap lumber from Ga. and Wa.

The real question should be when will be the Canadian worker be out on the street homeless.

Answer 3

Edge caliber--------I'm looking around and I'm seeing prices drop. Gas is down 15 cents this week. Automobile ads are advertising lower prices. Heck, even the cost of my Wild Turkey went down 50 cents this week.

The economy is all interconnected. One element (the value of the dollar on the world market) doesn't necessarily affect all the other elements.

Answer 4

Clinton hid his economic collapse until bush was in office for a month. They have ways to hide this crap for a small amount of time. International banks have just created a shortfall of loans to hide the world mortgage collapse that's coming.

Answer 5

if his wallet has 5 billion income it, i dont think of he (or all people) might have the potential to %. it up....paper has a tendency to be somewhat heavy in intense quantities...yet whilst i became superman...hell no, identity fly away with it

Answer 6

Do you mean when do we tell were getting ripped off? I feel ripped off when i realize I bought stuff that has no good use and I could have saved my money for something better.

Answer 7

it wont make a difference.
now the cost of beef and anything else bc of ethenol is going to cost the whole world. should al gore foot the bill? damn hippie freak liberals

Answer 8

now, we are equal with the canadian dollar whats next the mexican peso?

Answer 9

Only if you travel to other countries.

Answer 10

Funny, Cavuto said it went up yesterday. I guess you must know more about it than he does.