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US Dollar Index 14-Year Chart
Daily chart of 14 years of cyclical developments in finance & politics
Ashraf
alive, spec, carlco and others. many thanks for all your contributions
dollar index is 8% above its lowest point ever on trade weighted basis so im not sure why you think it's in a bull market. you should look at the charts when you decide whether something is in a bull/bear market and not teh fundamentals. yes, european fundies have some very bad dynamics but that does not describe the chart. i also disagree that EU UK are suffering in EXACTLY same way as US is suffering. i made my case about US consumption and debt-based economies being lacking its biggest engine but nobody replied to that. saying something is just as bad or just as good w/out providing arguments wont really cut it in a discussion.
for those who think the US will continue to bail out the world out of recession think again. didnt you forget that last year the BRICS accounted for over 60% of the increase in global growth? now let's not use the 1970s attitude that this so-called less developed nations will need the rescue of the US. things are changing and the BRICS are not a fad. they produce real stuff, commodities and also buy things from US europe and Mideast.
This is not 2002 or 1999 when the US used to purchase 1/5 of the worlds exports.
would love to discuss more but it's a v. busy day. again, i urge people to read into the arguments, think about them and provide counter arguments and not just make blank statements (this country isbetter than this country and thats it).
Pls research on how much the BRICs are contributing to world economty in supply and demand and how has this chanegd over last 5 and 2 years.
Ashraf
keeping rates artifically low can help for a while as it did in the early 2000s when the us was almost near a recession. then it all went belly up when bubbles were creating promoted by cheap us dollar short term rates.
the emerging markets cannot bring the US out of recession as they are net exporters.
why would us raise interest rates to benefit the dollar? it would have far more devestating effects on recovery.
Q. As in Japans lost decade, I believe we are heading for a world of stagflation, this 0% interest rate policy i don't really understand the mechanics of it. My point is if it didn't work in Japan with a busted banking system and the rest of the world on boom, how is it going to work now ? Are we to rely on South America, India, Africa, Australia, Russia and China, to drag us out of recession ?
Q. Wouldn't it be best, bizarrely, if the US began raising interest rates now? that would be good for the dollar right? lowering oil prices and getting things moving ?
oh btw, i was listening to a podcast on companies Chapter11's in the US, the banks are sweeping accounts of some medium size firms for all their working capital, even when their assets are 10 times the borrowings, no wonder the West has come to a standstill, this example was a boat builder worth about 500-600 million, borrowings of 60million, it's a disgrace.
i think part of the issue with a weak dollar was that too much was being sold off due to domestic consumption and dollar diversification into risker assets as part of portfolio investments abroad.
obvously anything could happen, china is backing up US dollar but may quietly diversify out over time but that could harm its exports to US. the fact that it has so much of the stuff it aint in chinas interest to see the dollar fall as they would substantially lose.
investors are less worried about debt ratings than they should. when the uk got a negative outlook from s&p (i think) the market quickly overlooked this stormed higher. that seems odd considering the uk is a small economy and a riskier currency than say euro in terms of reserve status.