The dollar is getting stronger ??? - page 12

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Guys! Stop bickering with each other, you've turned the forum into a clamour. You're bickering like women in a bazaar!

Don't you have any business ideas?

 
Angela >> :

Guys! Stop bickering with each other, you've turned the forum into a clusterfuck. You're bickering like women in a bazaar.

Nothing! Soon all these slackers will be given a beta of MT5 - they'll chew on it!

 
A lot you have written, i.e. laboured. That calls for a thorough response. But how hard it is to read you... Try breaking up the text into paragraphs to highlight each thought separately.
Infinity >> :

Well initially no one is pressuring the USA to raise the exchange rate, it is another matter that they need to, because their economy is also suffering a lot from this. That is why they have brought countries together to address the issue, but how can they help on this issue?

Every drug has side effects. The cheap dollar undermines imports of cheap consumer goods that people are already used to. But it promotes local businesses. The latter is much more important in the long run.

In this article there are direct quotes about how other countries are demanding a strong dollar, i.e. they are pushing it. It is very easy to do - just raise the interest rate, no help from the US here. Yesterday they raised the interest rate in Australia and look what happened to their currency. Another matter is that the U.S. does not want that, see above.

Infinity >> :

It is interesting that countries are willing to lend the U.S. money because it is not just possible and they offer this, but also because it suits them. Like the USA pays its debts and is prepared to borrow as much as it needs to to cover its own debts, and not to feel bad about it, because they pay it off confidently and on time.

I did not say that "countries are willing to lend to the US in 'debt'". Countries are in debt like silk and are constantly borrowing, countries have no money for such investments. But private investors do have money, and it is they who lend to the US. That is because the US is a good borrower, and pays interest and back debts on time and in full. And a large part of those investors are Americans, I would not be surprised if most of them are.


Infinity >> :

Or maybe it's worth looking much deeper....... For example, 3-2 years ago, when inflation went up in the U.S., the Americans decided to fight it by starting various programs to reduce inflation, one of the programs was a program to reduce interest rates, money supply control, monitoring of budget risks, as well as antitrust policy. That would have been fine, but then GDP fell, and the recession hit.

Inflation is not combated by lowering interest rates, on the contrary, they are raised when there is inflation. You are looking at it too superficially. It was like this:

- Sluggish 2001 ended with the collapse of the twin towers. The country was in shock, the economy was on the verge of collapse, a crisis was inevitable, it was already on the horizon.

- An active campaign under the slogan "consume is patriotic" stirred up the population, and heavily discounted interest rates added fuel - the economy went into overdrive.

- Lots of cheap money stimulated the growth of everything, including real estate bubbles. Mortgages were given to everyone in general - even the unemployed - at 1% interest, or even free for the first year. Inflation went up.

- A bubble can't grow forever, and hardworking Americans responded to high demand by setting up a sea of real estate, and it stopped growing in value.

- This is where the "3-2 years ago" comes in, when there was already inflation in full force and the government raised the rate to beat it. And those who had borrowed at 1% were no longer able to pay. The problems snowballed.

- The crisis hit. Not giving a damn about future inflation, the government lowers the rate to stimulate the economy. This is where we are now.


Infinity >> :

Since the USA was looking for money to support its GDP from loans from other countries and could not afford the fabulous sums, the USA had a deficit in demand, compared to the fact that production did not cut back, hoping that things would soon turn around, but they did not, and the costs kept coming.

The US does not need to support GDP, there is nothing wrong with it. The money is needed for other things. The US can afford almost any amount, they are given (so far!) - this is an objective fact. Demand problems have arisen because the population, seeing the crisis and rising unemployment, has begun to hoard money. The savings ratio has reached record highs, people do not spend, but hoard for a rainy day. It is clear that the economy is suffering from this. This is where the government comes in: first, it makes money cheap and available to the population, i.e. it encourages people to spend it, and second, it spends it by itself - by paying for different infrastructure projects so that people at least produce/construct something.


Infinity >> :

The economy should seem to be recovering, but after it clears, the debt burden will only increase, because the proposal for a new stimulus will not lead to anything, the old debt is as big as it is, and new debt will form, and the problem has not been solved and will not be solved...In the future, treasury bonds will soon be repaid, and there is nowhere to go but to issue new bonds (there is no timely repayment, there is just the old debt + current debts + interest on these debts, which are paid back by the interest payments).

All yes - the debt load is growing and if it exceeds some threshold, it will be very bad. But so far it hasn't. Bonds are being repaid all the time, i.e. they are not just around the corner but are being paid off right here and now. The US pays them off all the time and takes the money by selling new bonds. They have a lot of experience in this business. The GKOs in Russia collapsed because the government failed to balance long and short securities, i.e. there were only short securities in the GKOs, which have to be redeemed right now. The US spread the burden evenly.


Infinity >> :

In the end such a debt bubble will burst, but just the strengthening of the dollar, will contribute to reducing the US deficit, and not the interests of the importers (although they need it too) the main task remains the main one, to get out of the crisis.

Maybe it will, anything is possible. But it's a long way off for now. But with a strong dollar it is exactly the opposite.

Imagine that the US owes France $1000 (all US debts are denominated in dollars). The US sells "I love NY" T-shirts to France for €10 per T-shirt. The question is how many T-shirts do the Americans need to sell to cover their debt if the dollar is strong and worth 2 euros, and how many if the dollar is weak and worth 1 euro.

 
timbo >> :
I apologize for such long sentences... the thought was vast) I will take your suggestions into account from now on.

All that I wrote, it was also taken from official sites, from speeches made earlier and in the future from speeches and the like, fsr just in one of the reports says that "once again have to print" no matter money or paper, and unfortunately they specifically say that there is nothing to do again loans ... I don't know if we have different perception of information or different points of view ... so what's your point of view? What will happen to the dollar and why? I have been maintaining my point of view, that the dollar will grow next year and the interest rate will go up, so I think I will stay!

 
Infinity >> :

What will happen to the dollar next and why? I think I stand by my opinion that the dollar will go up next year, and the interest rate will go up.

The interest rate will definitely go up, simply because there is nowhere to go lower. With the dollar it is more complicated. Its growth depends not only on the US interest rate, but also on interest rates in other countries. If Europe raises rates at the same time as the US, the euro-usd will stay at the same level. I think the US will come out of the crisis faster than Europe, which means the dollar will rise against the euro. But not against, say, the Australian dollar. Australia has sat on the tail of China, which is actively developing domestic consumption, i.e. less and less dependent on the global crisis.

No one can know how it will be - in fact it is much more complicated than in reality. The main thing is that there will be no apocalyptic scenarios with World War 3, US default, Amero etc., everything will be boring and slow.

 

Сегодня стало известно, что Бараку Обаме присудили премию мира за 2009 год за экстраординарные усилия в укреплении международной дипломатии и сотрудничество между людьми. Обама - не первый президент США, получивший такую премию, в 1919 году ее удостаивался Вудро Вильсон


Wilson signs bill to create Federal Reserve

Obama has proposed expanding the powers of the Fed

horse-drawn circus

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