The value of the DOLLAR is falling ... Who is to blame?

[Angela Shelley]

The value of the DOLLAR is falling ... Who is to blame?

Thanks for your participation.

[Betsy Ross]

1. Republicans. n/t

[Warpy]

11. That's basically it.

Their screwball economics ideology hasn't changed since Harding, Coolidge and Hoover got us into the last Great Depression.

I'm afraid this one will make that one look like a cakewalk. We can't borrow our way out of this one. The only place to go for money to restart the economy from the bottom up is the top, and they will never allow their own resources to be tapped.

[lonestarnot]

16. In a big fucking nutshell!

[Mike03]

20. As much as I hate the Repukes,

it is dangerously simplistic, irresponsible and unrealistic to blame Repuke politicians for the mess we are in, when the incredible ignorance of most Americans is equally to blame.

[bdamomma]

77. ...........

:thumbsup:

[Ganja Ninja]

74. Things were going along just fine until they decided to "fix" every-

thing. They have deluded themselves into believing they are infallible when it comes to the economy. They latch on to whatever hair-brained scheme the party is peddling and embrace it without the slightest bit of doubt or apprehension. They're Lemmings ready to swim to the horizon or die trying, never stopping to ask why.

[baldguy]

76. Bingo

Starting with Reagan

[ayeshahaqqiqa]

2. Those responsible for the Iraq War

and those who would give the wealthiest all the tax breaks. In other words, Republicans and their enablers of other parties (like Democratic-Independent Lieberman)

[harun]

4. Beat me to it. It is because of the debt accrued from all we have to

borrow to fund the Iraq war.

A bunch of other stuff comes in to play but what no one will admit is that is the PRIMARY cause of all of this.

[Warpy]

13. 90% of the debt is from the tax cuts to the wealthiest

Don't kid yourself about the wars. They weren't the biggest fiscal problem. Those incredibly reckless tax cuts to fat cats were.

They pull this shit every time they get control of the economy and it always has the same outcome.

[nRkiSt]

17. Many factors - war, oil and easy credit/flat wages

As long as the Fed keeps lowering interest rates, traders will push up the price of oil just to offset the lower value of the dollar. The role of the US dollar as fiat currency for oil may soon be over, and Washington simply can't afford to invade and occupy another oil producing country (Iran) to stop it. The ultimate irony is that Cheney and Co. invaded Iraq to halt Saddam's effort to trade his crude for Euros (see secret "Energy Task Force") but in doing so they have pushed the nation closer to bankruptcy and made the dollar less attractive as the fiat currency for oil. The Fed can't keep lowering rates forever, and that means a few VERY LARGE banks might go bust. Good thing we got W to figure all this stuff out.

[bdamomma]

79. Welcome to DU nRkiSt!!!

:hi:

[Speck Tater]

3. None of the above.

Money is a means of storing and exchanging wealth. Money is NOT the same thing as wealth. Wealth is tangible goods produced by a combination of labor and resources. A nation has a much wealth as the resources and labor it applies to the creation of real wealth. Our labor is being outsourced, and more and more of our resources are being imported. The net production of real wealth in the US is falling. Therefore, as the amount of real wealth produced in the US falls, the amount of real wealth represented by each dollar must fall.

Since wealth cannot be created by printing more dollars, each new dollar that is printed further dilutes the real-wealth value of the dollar. Each new "virtual" dollar created by debt also dilutes the value of the dollar relative to real wealth.

[melody]

6. Angela has been defending Alan Greenspan

I think that theory wouldn't have much traction with her.

[Angela Shelley]

25. Only defending his remarks about the fall of the dollar.

It´s written on the wall, but not everyone sees it.

Alot of people don´t want to listen to bad news.

[melody]

29. US progressives live with bad news 24/7

If you think we don't know all this, you're mistaken. Many of us fully expect a bad depression.

The only quibble I have is with your depiction of Greenspan playing no part in the problem.

[Angela Shelley]

30. OK melody, I understand your point.

My point is that when Greenspan tells other "dollar holders" to dump the dollars, he´s giving them good advice. He´s not the only one giving these speeches around the world.

The Fed used to have more control of the dollar, but they have bitten off more than they can chew.

The problem is, nobody wants to be the bad guy, and dump their dollars all at once.

Thanks for the clear and honest discussion.

May I share my popcorn with you?

:popcorn:

[melody]

38. My problem with Greenspan is not his advice to others ... my problem is his record of policy

Greenspan's lack of loyalty isn't his advice ... it's his whole record of doing the internal business of the globalists
against the citizens he was paid to serve, that I have a problem with.

[melody]

5. Why the need to assign blame?

Does it really matter?

It's not going to impact you very much anyway. It will impact us.

[Angela Shelley]

26. When the US economy fails, it will affect all of the economies

in the world ... because ... other countries who have been selling goods and services to the US will now be losing a percentage of their business.

For example, companies in France which produce cheese to be exported to the US will have a reduction in sales. These cheese producers make cheese from milk, so the milk producers will feel this too.

The fall of the US dollar is a major concern for every economy on the planet.

[melody]

39. You have safety nets in place ... we do not

It's going to be a major depression here. As I've said, the more concerned people are stocking up, buying weapons, and expecting the worst. The brilliance of the neocons/Henry Jacksonites and their ilk is that they've managed to make the world hate their primary victims.

This was all put in place fifty years ago. It's all going according to plan. I'm highly critical of 90% of so-called "conspiracy theories", but this is so evident to a lot of us now, it's practically social theory.

[Angela Shelley]

56. Please explain.

What is the plan?
Who wrote the plan?

[melody]

58. It would take about three hundred books, numerous white papers and about two months to explain

The European and American elite have been fairly overt about it. David Rockefeller brags about it.
The aim has been to destroy our sovereignty. The plan has been ongoing in one form or another for
a century. The Bush family has been a large part of the "plan". Prescott and his generation helped
form the more modern version of it.

I have a couple of articles at Op Ed News that cover the basics:
http://www.opednews.com/articles/opedne_melody_c_070713_the_bush_family_and_.htm
http://www.opednews.com/articles/opedne_melody_c_070904_a_new_and_improved_i.htm

Here's another one that deals somewhat with the issues involved:
http://www.opednews.com/articles/opedne_melody_c_070824_left_with_nothing_2c_s.htm

[Angela Shelley]

61. Thanks for the great links and your personal experiences,

giving me insight. :-)

[bdamomma]

78. whatever we do, does have a ripple effect in the world.

all the more reason why these SOB's have to be put in jail.

[MethuenProgressive]

7. Hillary Clinton

This is DU. *Everything* is Hillary's fault.

[Lilith Velkor]

8. The top 1% have killed the golden egg-laying goose.

[Clintonista2]

9. The gays..

:sarcasm:

[gratuitous]

14. And the consumer class

When people have spent every dime they have, borrowed to the hilt, maxed out the credit cards, and finally acknowledged that they can't keep pumping air into the leaky balloon of our economy, the dollar goes flat. If we all just banded together, got over those nasty addictions we have to housing and eating, and blew our rent and grocery money on luxury items, the dollar would be just as right as rain! For another month or so.

[melody]

22. Just the gay penguins n/t

[Deja Q]

32. I would hope it's sarcasm.

Companies seek out gays because they're seen as more profitable; more "disposable income".

The reality being, they are not part of the problem.

[w8liftinglady]

10. all these greedy bastards that have sacrificed our economy for a few bucks

[TexasObserver]

12. The President. He submits the budget. Decides to deficit spend, to cut taxes to his base.

The president is who appointed the Fed Chair, who clearly is a water boy for the rightwingers.

Deficit spending, tax cuts for the wealthy, a grossly imbalanced budget, borrowing from those who import to us, a costly war that drains resources, and policies that favor globalists at the expense of American workers all lead back to Bush.

[On the Road]

15. It is Tempting to Vote for the Fed

but the Bush economic policies have given them little leeway without risking a complete meltdown, so I voted for Bush.

[L. Coyote]

18. OTHER = deficit spending bu USG

[Mike03]

19. Nobody wants to hear this, but we are all to blame

The Fed is to blame for lowering interest rates, making cheap, easy money so liquid and available.

Borrowers are guilty for borrowing sums of money the knew they could not repay.

The POTUS and his spokespeople are guilty for promulgating the fallacy that our economy is and was healthy when it was obvious at least as early as five years ago that we were very sickly.

We are all guilty, including myself, for buying a lot of idiotic, useless shit. The smart thing to do for the past twenty years (which I have also done) is to stock up on essentials that we all knew would rise drasticallly in price.

We are an impatient, restless, hungry, greedy culture, in general. And this is what you get when you combine desire with availability. There's not going to be any happy ending to this, for at least 70 to 80% of our population.

[melody]

21. Reason or not, only the middle class and poor will suffer, so why blame the biggest victims?

Especially now that we can do nothing about it. Granted, people who hate us will dance in the street to see our suffering, but the vast majority of Americans did nothing to bring this on themselves. Those McMansions are still the minority form of housing, whether it conforms to a favored stereotype or not. The REAL villains will be able to jet out of the country and hide in their chalets in Europe or their mansions in Dubai.

I'm not impatient, restless, hungry or greedy. I live in a small home that is paid for, I live a green lifestyle, I have savings and no bills. My people have lived here 350+ years, as I've said before. You can't find a more stereotypically "American" person than me. And I ain't no fortunate son (or daughter, in my case). :)

[Deja Q]

34. That's okay. The same folks will scam those countries' peoples too.

:shrug:

[melody]

40. Oh, I know. They've already moved the roadshow onto Canada and Europe

Australia/New Zealand, in general, seems to be being a bit less gullible, but then they're not as prone to "those awful Americans"
manipulations.

These people play the populations like a play-by-colors piano.

[Deja Q]

33. Or jobs allowing people to live and eat* reasonably confortably.

* by "eat", I mean real foods - vegetables, lean meats, yadda yadda. Not the processed garbage, corn syrup, et cetera.

If anything, we'd be better off exercising more, but we're too busy working to maintain families AND the ability to eat (properly or otherwise). Indeed, someone recently mentioned macaroni and cheese sales have gone up. Processed, bleached wheat for the macaroni and powdered fat gunk that comprises 99% of the cheese... at least skim milk is cheaper than whole milk, or am I getting that backwards?

[gulliver]

23. Some Republicans asleep at the switch...some with their hands...

...in our pockets...some picking stupid fights for us.

[champion-these-facts]

24. Reaganites - to be specific, but we can do something too....

To be honest there are 2 most relevant reasons I can think of.
One you and I have to seriously do something about, one we can truly point the finger.

Reason 1 - The overall real decline of American business (think Lou Dobbs!)
Service industries will not sustain the US into the future. First is we have to stop buying cheap Chinese products that won't last but 3 years if we're lucky. We have all got duped into this type of "dumb consumer" habit and we're witnessing the wholesale selling off of America because of it. Yes we were set up, but shame on us for going along with it.

If we can get someone in that can, as some promise, to invest and give credits in good old US industries, then the dollar could be stronger again. But we as consumers have to ever intelligent about what we are buying. You can buy American if you look hard enough.

Reason 2 - The Reaganites dream (take the money and run)
The world is witnessing the economic decline of America fueled by irresponsible Reaganite economic policies, resulting in chronic trade deficits and obscene generation of national debt. Most troubling, the falling dollar puts the United States in an ever increasing precarious state with China, the next economic superpower.

There are 2 specific downsides to this, with nothing that could be viewed as positive:

1. China could eventually not go along with "buying into America" if it really is not a good investment. They will diversify and go elsewhere, therefore who do we get to finance our debtor economy? Some currently argue that China needs some place to dump their profits and they need us, but the day when that becomes irrelevant is quickly approaching. China will gain economic strength and become increasingly "self-sufficient". If they have even half the economic sense that we have they'll invest in their own country and "make money" that way.

2. With less ability to sell of our debt, we would have to lower interest rates to the point that it would HAVE to be attractive. Thus we fuel even more "giving away America".

As the dollar declines, it simply damages the reputation of the US and the reason for investing in it. We try to convince ourselves that other countries will never have us by the balls but that day is on the horizon because of the sure path of debt that the Reaganites have put into place.

The responsibility lies with Reaganites, Reagan himself in 2 terms followed by those that believe he was Santa Claus (Bush et al) and not only continued the tenants of large military and low taxes but carried it to an incomprehensible extremes.

Just think, the national debt will soon exceed 10 Trillion dollars.

WOW

The only solution is to raise the upper rate back to 40 to 50% (the rich would scream as they did during Clinton/Gore) but in the end they'll be just fine, and we can once again get back to a balanced budget, and HOPEFULLY start to pay down the debt.

The ability to even talk about and consider the potential to start paying down the debt is slipping away day after day.

[kentuck]

27. $100 per barrel for oil...

Before the Iraq invasion, oil was $25 dollars a barrel. Figure it out. How many dollars are we sending to the Middle East just for oil? Also, figure in the trillions of dollars that we have borrowed in the last 7 years. There has to be a consequence for such incompetence and malfeasance.

[Angela Shelley]

35. The price of a barrel of oil is the same all over the world.

If the oil is bought on credit, then the problems begin.

[melody]

42. It's the impact of the oil here that is different. That's what is happening in-country.

And I think it's a part of it.

[davekriss]

69. No the price of oil is NOT the same around the world

Though most all of oil is denominated in dollars, the amount of Euros, Yen, and Pounds the buyer needs to convert to dollars before buying a unit of oil is variable over time.

Although the nominal dollar price of oil has risen over $100, the real price to a European (for example) has not risen nearly as much as it has for us. The reason? The declining dollar, which I've seen remarked as responsible for upwards of 60% of the price rise to Americans (leaving 40% of the rise to supply and demand plus accrued supply risk due to military conflict).

Do the math: If, at the start of the George Bush Republican debacle of a pResidency, it took 1.25 Euros to buy one dollar, and oil was priced around $18 per barrel, then you were spending 22.5 Euros per barrel in 2000. Today, at $100 USD per barrel and an exchange rate of about 1.52 dollars per Euro, you're spending 65 Euro per barrel -- albeit almost 3 times as much as the typical European was paying in 2000, but nowhere near the 5.5x an American is now paying.

Further, factor inflation into the equation. I don't have facts handy to cite but I believe inflation was higher for Europeans than for Americans. Let's assume Europe experienced an average of 5% inflation (to our 3%) over that period. Expressed in 2000 Euros, our European neighbors are paying 44 Euros per barrel. Again, 100% more than they paid in 2000, but not near the wealth draining impact of the 350% rise in real costs that we're experiencing.

So what's driving the decline of the dollar? The huge balance of trade deficits, federal budget deficits, and rising private debt. The world sees that our ability to invest in ourselves is declining. They see that our ability as a nation to generate real wealth has fallen behind the pace of growth of our money supply. And 8 years of mad rule by our modern Caligula has made us a less attractive haven against economic risk. So they adjust: Hold less dollars and more Euros, Pounds, and Yen. Our dollar declines.

I think there's another factor at play, too. Our declining dollar is partly due to a reaction to Bush's de facto declaration of war on the rest of the world. Bush, via the National Security Strategy of December 2002, announced that we will not allow any nation to threaten our position of hegemony, and that we'd engage in "preventative" war to eliminate anything we perceive as emerging threats. (What is that if not a declaration of war?) Meanwhile, the world has witnessed the subsequent imperial misadventure in Iraq plus the shredding of the constitution outwardly observable through signing statements, overt state-sponsored torture, spying on American citizens without warrant, and more -- the world observes that Bush and the political class he represents mean business. Knowing it is folly to defend against this declaration by direct (military) force, the world seeks to crumble the foundations upon which U.S. imperial power depends. They do what they can. One thing they can do is slowly erode the dollar. Thus, our dollar declines.

[El Pinko]

28. POS Bush, Helo Bernanke, Alan Greenspan, and to some degree, every prez since Reagan...

...Since Reagan was in office, we have had consistently low taxes on the rich and flat wages for the lower half of income earners. The fact that so many people are not earning a decent wage is a big reason for a lot of the personal CC & HELOC debt (although more comfortable people living beyond their means is part of it too).

Destroying a nation's middle and working class jobs and shipping them overseas can only make a nation into an economic basket case, even if the top 30 or 40% of income earners are fairly comfortable...

If it wasn't the decimation of middle/working class, there would have been no debt explosion, there probably would not have been nearly as much of a speculative housing bubble if income gains had been more evenly distributed (wealthy people with extra money to invest in RE helped drive up demand and prices, shutting millions out of the housing market, unless they took out those cuckoo loans...

And now the fed is devaluing the currency in an attempt to inflate away the debt...

[Deja Q]

31. Those who make a society.

Our economy can not let everyone be billionaires; I don't care what Rush said circa 1993.

And those with money are typically the ones who make and maintain the system.

There are ultimately two options available.

[Angela Shelley]

49. If the dollar is deflated enough, then everyone could

be a billionaire (at least for a short time). It worked in Germany. :-)

[Greyhound]

36. You left off the one choice that is not a bullshit distraction. The Federal Reserve Bank.

The non-governmental, self-regulated, private entity, that does, in fact, control the value of the USD. Coincidence?

[melody]

43. I'd say that's what she meant by "the Fed" n/t

[Greyhound]

63. Oops. n/t

[seasat]

37. I'd say, all of the above share some blame.

IMHO, the primary cause for the fall in the dollar is the trade deficit. We have more money going out than coming in. Bush, Cheney, and congress have overseen an expansion in the deficit along with the federal debt. The Iraq War and tax cuts for the wealthiest 1% are primarily to blame for the deficit. This has also contributed to the falling dollar. Finally foreign investment has slowed due to lack of confidence in the US economy. The Fed helped create this housing bubble by promoting ridiculously low credit to get the economy going in the face of Bush's weak economic stimulus following the 2001 recession.

The only reason a dollar devaluation hasn't hit us earlier is that foreign investment balanced it out. Part of that investment was from China and Japan buying up Treasury notes to keep the exchange rates favorable to them. The consumers liked the exchange rate because it resulted in cheap foreign goods.

The other part of the foreign investment was because of our strong stable economy. However, Shrub Inc has ruined our reputation in the world, broke our economy, and increased debt to unmanageable levels. This has hurt confidence in foreign investment in the US for both treasury notes and private business.

Another problem is the dollar used to be the sole currency for international exchanges. However, with the US thumbing our nose at the international community over dozens of issues, more exchanges are moving to alternative currencies like the Euro. Lower demand for the dollar equals a fall in it's value versus other currencies.

Therefore, all those folks listed had a part in it. Shrub Inc is responsible for the lion's share of the problem since they are the ones that created many of these problems.

[killbotfactory]

41. It's our fault for not buying enough stupid shit

on credit.

[Angela Shelley]

47. Maybe you could remove the "not" and the sentence

would be closer to reality?

[Fire Walk With Me]

44. Those who want easy control over a desperate, uneducated population.

They have to first create desperation, and limit education.

It's good to be Imelda Marcos.

[tomreedtoon]

45. A babyish President and a babyish US Population.

The Monkey in a Man Suit told us it was okay to spend and drive big cars. We believed him.

As a result, our economy became driven by sales at Starbuck's and Wal-Mart.

When we ran out of money (about a week ago) the economy started tanking, and slowly, we got the idea that we had been taken. And yes, Bush can take a lot of the blame, but in the end, it's the fact that all of us are greedy infant morons that is the dominant factor.

[Angela Shelley]

46. That´s a short but sweet depiction of the truth.

Thanks for your comments.

[tomreedtoon]

51. Thanks. I hate run-on bloviated posts.

Strunk and White's The Elements of Style has one important rule: "Eliminate needless words." I have tried to do that whenever I write and talk, and believe me, it cuts through the crap fast.

[Angela Shelley]

53. That´s like KISS: Keep it simple, stupid.

:-)

[melody]

73. Only simple people keep it simple

That kind of thinking is the whole foundation of authoritarianism.

[melody]

65. Unfortunately, elminating "needless words" sometimes means overlooking important detail

Like all the gray area between reality and "babyish".

[tomreedtoon]

71. Problem is, you know what a big grey area is?

A fog bank. And there have been so many people insistent on spewing out words and making teeny distinctions, that people give up reading their posts. Mort Sahl was a tragedy, and no one should emulate him.

[melody]

72. No, that big grey area is called "room for doubt" which fundamentalists and authoritarians hate

Black-and-white, simple minded thinkers, in other words the same people who want to tell the rest of the world
what is "right" and "wrong" ... what to believe ... with whom to sleep, etc, etc.

George Bush is an authoritarian. He's the tragedy -- grey thinkers protect us from his ilk.

[Deja Q]

48. But why did nobody build small cars?

[tomreedtoon]

50. Baby want BIG car! Baby don't want no TOY!

Bush and his business buddies knew we were infants and wanted big toys and stuff. When you're in a car that swallows you, you feel REAL big.

[Angela Shelley]

52. The Big Car movement started long before Bush and his

business buddies.

The automobile industry catered to the wants and needs of the customer. Too bad that oil is a limited resource.

[Joanne98]

54. A chart is worth a thousand words.

[Angela Shelley]

55. Thanks for the visual aid.

Who should be held accountable for the decreasing value of the dollar?

[Joanne98]

57. The "freetraders"

[DarkTirade]

59. I blame the fact that this country doesn't produce enough anymore.

It's not just jobs being outsourced... it's production. If we aren't making things, then we have nothing to sell both in and out of our own country. Other countries are selling things to us. Which means all of our cash is flowing out, and none back in. The only jobs left are service and entertainment type jobs... and the only ones that pay decently well are medical ones. However, since more and more people can't afford healthcare, I'm sure the number of health jobs will decline. If we don't get manufacturing back in this country, the dollar will continue to fall.

What we need to look at are the REASONS why this country isn't making anything anymore. Most namely, the big companies trying to save a few pennies by paying lower wages overseas, and the politicians in their pockets making sure that such things stay profitable for them. And while it is mostly conservatives/republicans doing these things, I'm afraid that there are bought and paid for politicians on both sides of the fence.

[Angela Shelley]

64. The companies are also saving a few pennies

in order to have lower prices to let the consumer "buy more things".

[DarkTirade]

66. Which, of course, only works in the short run

because then there are fewer jobs here and people get laid off and can't afford to 'buy more things'. :\ 'Tis a rather ugly cycle.

[Bushwick Bill]

60. Primarily, this clown.

[Angela Shelley]

62. Your Bernanke-Joe is tooo funny.

Throwing OPM out of the helicopter is easy.

[The Gunslinger]

67. Thats easy.......Bill Clinton (He gets blamed for everything else.)

Actually you get a bad economy if the cost of living go up and wages go down. Until that changes, the economy will never be well as debt will increase and personal savings will decrease. It's even harder to change it, because of the ties government leaders have with corporations. The dollar is down because of the current administration's lowering of the interest rates in order to try to put lipstick on a pig.

[margotb822]

68. Congress

They are the ones that have pushed Bush's harmful legislation, authorized war, approved bill to block our civil rights and give tax cuts to the wealthy. The first six years of Bush's presidency were free reign for him to get whatever he wanted because of Congress. Now the Democrats are powerless to change anything because Bush will veto. The best they can do is stall until January.

[Initech]

70. What about credit card companies?

They've been jacking up the interest rates to astronomical proportions, making it difficult for the average American to pay off their credit cards, screwing up their credit ratings and making big purchases seem near impossible.

[bdamomma]

75. did you include the invasion?

[jmondine]

80. Bill Clinton's penis