For all of these reasons and more, I think the surprising, but compelling conclusion is that you don't have to worry about it one way or the other. In other words, the same forces that argue for dollar devaluation argue equally strongly for dollar intervention by foreign central banks. If you owe the bank a million dollars, the banks owns you. If you owe the bank a trillion dollars, you own the bank. For reasons of reserve valuations and export competitiveness, our monetary authorities don't have to lift a finger to support the dollar. And they know it. But the BOJ, ECB, MOF, and a host of others do, too. And they will act. Out of self interest. The idea that they would only do so out of charity is the misguided notion. The competitive devaluation thesis seems to make the most sense to me.
Back in the old days, the USA had technology that was unique, could be exported for top dollar, and was able to support a domestic manufacturing base that was several times more productive than foreign manufacturers. But the bankers, by their greed, ruined the domestic technology industry of the USA, and eliminated most of the proprietary advantage of US labour. If anything, American workers need to work for even less than Asian workers, because American factories are far less energy efficient, less technologically advanced, and have far higher overheads (ie: unions) than the Asian factories. A 95% devaluation of the USD$ might be getting off easy.
ll this bullshit talk about a weak $ strong mkt is nothing but wall street hype talk to get stocks up. if a weak currency is good for the mkt and a strong currency is bad for the mkt then why are european mkts up the same as us mkts as the euro has skied? also in the 90's a strong dollar was bullish for stocks.its just walls treets way of taking something current and using it to there advantage. like in the 1990's many might recall how all waited with baited breath to get the monthly book to bill ratio for semi's. it would move the mkt huge. now not a word as nobody cares. in the 80's people waited for the money supply #'s every week which moved the mkt. in 1987 a weak $ was one thing blamed for the crash and now stocks love a weak $. wall street is the greatest salesman and twister of facts ever
Correlation does not imply causation. The dollar rallied as a result of a massive global deleveraging and a safe haven bid for Treasuries. By the same logic, employment and the markets should have rocketed higher from mid-2007 to mid-2008, when the USD fell from 83 to 70. Clearly they did not.
The US government will destroy the dollar because they just don't care anymore. They will inflate and hyper inflate using the crisis as reasoning to do so. One day soon people will realize that the banks are very well capitalized, with monopoly money. The prior crisis will be over but a new one will lye in wake. There will be huge devastation to the savers of this country. Unless you successfully hedged somehow against inflation it won't be pretty. The underlying economic problems won't be solved either. The economy will as bad as we have seen in the 21st century. The elites will use the moment to consolidate their power, gain more assets and control of this country. Entire businesses once highly profitable will be sold for next to nothing. The ownership of the means of production will become concentrated in ever smaller ultra elite groups. The planned demise of the dollar will coincide with the decline of the american empire. Capitalism market opportunities will dwindle, wealth accumulation from nothing will be near impossible. The American dream will be dead. Oil shocks will follow. Populist anger will reach a boiling point and rebellions will occur across the country the likes of which not seen in two centuries. Americans will never again enjoy the standard of living achieved at the height of the empire, in 2000. or something like that