Will the US dollar rebound in the near future?

Question

Turst me, I'm no expert on the subject, but I know it has a lot to do with the strength of the economy. I don't believe all the gloomy predictions that the dollar is done forever as a major part of the world economy. Yes, The Euro is an increasingly important currency. As far as I can see the US dollar may not always be dominant, but will always be important like the Yen or British Pound. I am predicting that the dollar is only going to go so low before it comes back. The question is when. I would image that the policies of our next president will have a lot to do with it. So, what do you think? During the next couple of months/years will the US dollar regain it's strength?

Answer 1

Neither magic nor serendipity has caused the USD to fall. The creation of $2 Trillion+ within 6 years has more to do with it.

US banks and the US government create money out of thin air. Although banks have a limit on the amount of money they can loan (create), the US government does not. This current administration has created more money than almost every prior administration combined.

Almost $2 Trillion has been spent on the wars alone. When the government spends money, it creates money. Taxes help offset the difference. But, when the difference is a deficit, that results in more money in the market. $2 Trillion is a lot of extra money in the market and as a result it saturates the market thereby decreasing the value of each dollar.

To help stabilize the effect, the Fed typically raises interest rates to discourage borrowers so that banks will create less money. However, this administration has also influenced the Fed to keep interest rates low so that the stock market won't plunge. But, something has to give. Since the US government cannot influence the world market, the USD continues to fall fast. And there is no end in sight.

You can thank this administration and their greedy myopic support base for the fall of the USD (and quite possibly the end of the US empire).

Answer 2

What would make the dollar bounce back? Our national debt & deficit are still increasing, we're on the edge of a recession and the housing market's still in a free-fall. Even assuming the next President & congress can start to improve the debt/deficit situation - which would take years, if it's even possible, the U.S. is still losing middle class jobs at an alarming rate, and health care costs are still skyrocketing. Oh, and let's not forget about the billions-of-dollars-every-month war we'll be saddled with for at least another year, probably several more.

The only positive indicator I've heard is that since the dollar's so weak, it's helped a bit with lowering the trade deficit - we're still buying more from abroad than we're selling to them, but the gap has shrunk a bit.

Answer 3

The price of the dollar always goes up and down against other currencies. When the dollar is down prices for US products go down and foreign citizens purchase US products. That spurs the US economy which drives the dollar higher. That slows down US exports and the cycle continues. The president has very little effect on the free market.

Answer 4

If another republican were to hold office it would never recover ! It was gwb that caused the weakening of the dollar and this nation can only take so much!

Answer 5

Since Hillary claims she can lower oil prices perhaps You should ask Santa Hillary to strengthen the dollar too. Her and Billy boy seem to lean towards the Chinese Yen for their currency of choice. Selling out this country must be high on her list of things to do instead of doing her real job.

Answer 6

It should improve a LITTLE in 2008... But it won't be until 2009 that it finally regains some of its previous luster... :)

Answer 7

Why not?
If the exchange is cheap.
Collect it.
Luke 8.10,17
What do you think?
Merry X'mas !