The Political Asylum

Goodbrit · Inmate of the Asylum Joined: 05 Nov 2006 Posts: 859

What will it mean for the world if the value of the US dollar falls by a big chunk? I think that could happen - Kuwait have reduced their exposure to the US Dollar and George Soros reckons the half point rate cut was pretty wreakless.

Can someone explain it too me please? If the value of the dollar keeps falling then why will countries keep buying bonds which the Americans need to run their country? Can they just rely on China proping up their currency for them forever, or will China get sick of flushing their money down the toilet by buying it only to watch in lose money. Plus China are slowly moving to a floating change rate so I hear?

So what will happen if the Dollar takes are real dive? How will that effect the world?
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Manchester, when death isnt enougth

Vintage Girl · Posted: Mon Nov 19, 2007 1:50 am Post subject:

I think you need an expert to answer those questions.

All I know is that I got $2 to the £1 last September and it was jolly good news for me. Very Happy

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Girls are like phones. We love to be held and talked to, but if you press the wrong button you'll be disconnected!

JuanaLaLoca · Posted: Mon Nov 19, 2007 6:34 pm Post subject:

I still can't believe that Canadian money is now worth more than American money! Shocked

Maybe it's time to try to cash in/exchange those traveller's checks I still have left over from a trip to Canada some years back. Smile

Goodbrit · Inmate of the Asylum Joined: 05 Nov 2006 Posts: 859

Im on my way to the states in december, i have $5000 dollars-ive doubvled my money, so im not complaining!
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Manchester, when death isnt enougth

Vintage Girl · Posted: Wed Nov 21, 2007 12:53 am Post subject:

Where are you going in the states?

Is it a holiday?
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Girls are like phones. We love to be held and talked to, but if you press the wrong button you'll be disconnected!

Goodbrit · Inmate of the Asylum Joined: 05 Nov 2006 Posts: 859

New York for a month, then Florida for 10 months to work in an exchange programme thing..
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Manchester, when death isnt enougth

Vintage Girl · Posted: Wed Nov 21, 2007 11:52 pm Post subject:

Wow, that sounds great. You'll have a fantastic time.
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Girls are like phones. We love to be held and talked to, but if you press the wrong button you'll be disconnected!

Michele · Guest

It can be sliced two ways. A low dollar is great for exports and tourism, but there's more to the story. For instance, Iran's President said recently he doesn't want to use the dollar for oil deals. I've read an article that the alleged the Iraq war was really about preventing Saddam Hussein from changing the petroDollar to the petroEuro (or whatever they'd call it.) Fewer companies are willing to invest in American assets. There's a huge trade deficit with China, who falsely peg their yen to our dollar.

If you raise the Federal Reserve interest rate to combat this, you'll be likely to see more fallout in investing, and more foreclosures. This might be a leap in logic, but stopping credit card companies from gouging customers would really help, if such a rates were raised. After all, the people "victimised" by those sharks would probably be the same as those having their homes taken away by the mortgage company. No more sub-prime loans.