Dollar hits new low against euro

Gambler · Post by **Gambler** » 2003-12-17 10:09pm

Soontir C'boath · Post by **Soontir C'boath** » 2003-12-17 10:12pm

I just got one question. Wouldn't this rather mean it is cheaper to do things such as manufacturing here then in Europe?~Jason

Gambler · Post by **Gambler** » 2003-12-17 10:18pm

Soontir C'boath wrote:I just got one question. Wouldn't this rather mean it is cheaper to do things such as manufacturing here then in Europe?~Jason

Yes, that is why so many european companies (the ones who export a lot outside the EU) are concerned about the low american dollar

Crown · Post by **Crown** » 2003-12-17 11:26pm

Fear the ECB policy of de-flation and boardering recession!

Darth Fanboy · Post by **Darth Fanboy** » 2003-12-18 03:35am

Weak Dollar = Good for the US

Fear Our Lower Cost Exports!

Glocksman · Post by **Glocksman** » 2003-12-18 03:44am

Darth Fanboy wrote:Weak Dollar = Good for the US

Fear Our Lower Cost Exports!

Not only ours.

The Chinese Yuan is pegged to the dollar.

As the dollar falls, so does the Yuan, making Chinese exports to Europe even cheaper. Have some nice Chinese steel. :p

Murazor · Post by **Murazor** » 2003-12-18 05:32am

This is only temporal. As European I would say that the problem was the extreme lack of confidence in the new money. The weakness of the euro came from it. Its real value shoul be of roughly 1,1 dollars. Until things get a bit more solid, there will be fluctuations hard to understand and hard to explain. Not all the economies in the EU were at the same level when the euro came to life and this will bring problems. However, it was needed as a tool and a simbol for the european construction and it was released at a quite good moment.

Crown · Post by **Crown** » 2003-12-18 05:36am

Glocksman wrote:
Darth Fanboy wrote:Weak Dollar = Good for the US

Fear Our Lower Cost Exports!
Not only ours.

The Chinese Yuan is pegged to the dollar.

As the dollar falls, so does the Yuan, making Chinese exports to Europe even cheaper. Have some nice Chinese steel. :p

The Chinese Yuan is grossly under-valued, everyone from the Fed on down has been complaining about it ... *grumble*

Crown · Post by **Crown** » 2003-12-18 05:37am

Murazor wrote:This is only temporal. As European I would say that the problem was the extreme lack of confidence in the new money. The weakness of the euro came from it. Its real value shoul be of roughly 1,1 dollars. Until things get a bit more solid, there will be fluctuations hard to understand and hard to explain. Not all the economies in the EU were at the same level when the euro came to life and this will bring problems. However, it was needed as a tool and a simbol for the european construction and it was released at a quite good moment.

Quite true, the economies aren't anywhere near conversion yet, Ireland and Greece are still growing at 4% - 5%, while Germany and France are in the 0.1% ... things will even out ... eventually ... I hope ...

Dahak · Post by **Dahak** » 2003-12-18 05:51am

Despite good data, the Dollar didn't manage to gain against the Euro in recent time.
With all the questionable things the Bush administration did, like wars, the high US debts,..., people are starting to look for alternatives.

And a low Dollar is problematic for the US: They import more than they export, so it now gets even more expensive for the economy...

Darth Fanboy · Post by **Darth Fanboy** » 2003-12-18 06:24am

Dahak wrote:Despite good data, the Dollar didn't manage to gain against the Euro in recent time.
With all the questionable things the Bush administration did, like wars, the high US debts,..., people are starting to look for alternatives.

And a low Dollar is problematic for the US: They import more than they export, so it now gets even more expensive for the economy...

Oh wow, so Americans such as myself have to cut back on our consumption of imported goods...(insert false shocked and stunned response smiley here) Someone Forbid that we have to ever do that.

Fact is as the dollar drops against the euro American Exports become cheaper, and unless A lower cost alternative is availiable (like china in some cases) America should be able to sell more of its goods overseas.

A weaker dollar is going to be better. Course Lets see if china or some other outside force doesn't try to influence the exchange rate a bit.

Dahak · Post by **Dahak** » 2003-12-18 09:18am

Darth Fanboy wrote:Fact is as the dollar drops against the euro American Exports become cheaper, and unless A lower cost alternative is availiable (like china in some cases) America should be able to sell more of its goods overseas.

True, you could sell more to overseas, but at the same time, you'll have to pay more for the goods you're importing. And since you're already importing quite a bit more than you're exporting...

Darth Fanboy · Post by **Darth Fanboy** » 2003-12-18 11:22am

Dahak wrote:
Darth Fanboy wrote:Fact is as the dollar drops against the euro American Exports become cheaper, and unless A lower cost alternative is availiable (like china in some cases) America should be able to sell more of its goods overseas.
True, you could sell more to overseas, but at the same time, you'll have to pay more for the goods you're importing. And since you're already importing quite a bit more than you're exporting...

Guess where our biggest Trade Deficit is? I'll give you a hint, it's not Europe.

It's China, and they have a fixed rate. So our Dollar still buys the same amount of goods over there. When we have to cut back on our importsits going to be in Europe more so than anywhere else.

Andrew J. · Post by **Andrew J.** » 2003-12-18 04:51pm

This is why a lot of people find economics difficult: it's so damn counterintuitive. You'd think it would always be a good thing for your country's currency to be as valuable as possible, but it's not.

otter · Post by **otter** » 2003-12-18 05:07pm

I see a larger influx of European tourists in south Florida this winter

Tsyroc · Post by **Tsyroc** » 2003-12-18 07:40pm

Darth Fanboy wrote:Weak Dollar = Good for the US

Fear Our Lower Cost Exports!

This woman I work with just went with her whole family to France for Christmas (they're visiting friends who came and saw them here last year). Considering all the extra work she did so she could afford to take several of her family members I'm sure she's going to "enjoy" the exchange rate now that she's over there.