Is the continued slide in the dollar a de facto tariff action by the Treasury

Department...

Import are sky rocketing as World consumers suddenly see competitive pricing of American made goods...

On the other hand, the decrease in the dollar is driving up the price of imports so that American made products are competitive with a growing number of imports...

There has been a decided lack of buzz about the steep drop in the dollar until a super model "allegedly" stated earlier this week that she wanted to be paid in Euros, not greenbacks...

What to make of this...

For years the American dollar was so strong that there was no way we could compete with cheaper imports....

As economy after economy around the world started to adopt market based approach to production, the dollar still remained high and the US consumers were actually subsidizing the growth of competitive markets throughout the world...

I think this has been the intent all along, to prop up third world markets in order to create those markets, break organized labor and regulatory oversight here at home and to "grow" out of the balance of payment deficit by at some point letting the dollar devalue...

Unfortunately, no one took into consideration the War in Iraq and the irresponsible borrowing by this administration...

It's going to be bumpy for the next several years, but I believe, that as more and more world markets become sophisticated, it will benefit us all...

Well, that is if we can somehow convince the ideologues left in the world that free markets with regulation and progressive taxes are the way to spread prosperity...

Well, that's my two cents...

it probably has something to do with wiping out our debts with China and those incurred by the Iraq War. By utterly devaluing the dollar, they hope to owe much less to the nation's creditors. As we know from Weimar Germany, such a strategy is risky, to say the least.

And the process in Germany was fueled by runaway inflation at home, something that is not a terrible problem at this time...

And our whole economy runs on that import!

My question is, how much of these skyrocketing oil prices is based on the devaluation of the dollar?

But one thing we have to consider...

The price of a barrel of oil during the Oil Shock of the late 70's and early 80's would translate, adjusted for inflation, to about $101 - $ 105 per barrel today...

Also, the energy efficiency programs implemented by industry and individuals over the years has decreased the percentage of income devoted to energy related spending...

Less of an overall impact...

Of course that gives no comfort to people who are trying to get by on a fixed income...

But at some point, the cost of food will start to climb as the cost of transporting food rises...

Also, plastics and fertilizers that are oil based would also reach a point where price increases would come into play...

Though I calculate a higher price of $139/barrel based on this chart:

and this inflation calculator:
http://data.bls.gov/cgi-bin/cpicalc.pl

The issue with this thing is that I am not hearing of a ceiling to it in the long term, and that's what's worrisome to me. Nobody seems to know where the relief on this is coming from.

It has to unless we truly have hit peak production...

But I think this run up in price is speculation by professional investors looking for a quick buck...

If you take reports like this seriously:

http://www.nytimes.com/2007/11/07/business/07cnd-energy.html

Then the long term picture is ugly. It doesn't require peak oil yet, just an inability to have production meet this insane growth of demand in Asia...

We should just get to work on developing alternative energy and fast so that we can all ween our selfs from oil...

A stable one does.

The popular argument is that a weak dollar makes it uncomfortably expensive to
import and makes our own products attractive abroad, pricewise. OK, but just what
is it we're selling? Outside of airplanes, we don't make much any more. Our cars
are made in Japan, our electronics are made in China, and our answering services are
made in India. We have some knowhow, which is dampened by archaic tax laws that make
it horribly expensive for American companies to maintain American employees abroad,
and we have (or had, anyway) an abundance of natural wonders that made it attractive
for foreign tourists to visit the USA, until our border procedures starting pissing
so many of them off, being treated like suspect Al Qaeda chiefs at the border until
proven otherwise, even Swiss bankers (some of whom I know, and now refuse to return
to the USA until they can enter as easily as we can enter Switzerland). We also have
some decent agriculture, unless the Republicans succeed in kicking out 85% of the
foreign labor that makes it work.

But since currencies these days are no longer backed by gold, or anything tangible, it's
all a matter of interest rates and perception. The perception these days is that we are
getting killed economically by expensive oil, somewhat low interest rates, and deficits
that are only being covered by the emperor's new clothes, and you all know how great a
cover they were. The Chinese have over a trillion of our dollars in their coffers. If
they want to exchange them for euros or gold or pounds or yen, can we pay up? No. We
could always agree to give them Seattle as collateral, or something, I suppose.

We are too connected to their economy and they to ours...

But I do think they will start shifting their money from this point on into other currencies...

I agree that stable but lower dollar is to our benefit.

A large percentage of "Japanese" cars are being made here. A cheaper dollar will encourage more of this.

Intel has just opened a 3 billion dollar FAB plant here in Chandler Az., and Microchip Tech has expansions plans on the board. It's becoming less expensive to manufacture here than before.

Because of worldwide demand and a cheaper dollar a number of copper mines are reopening or expanding production in Arizona's mining belt.

China owns less than 5% of our debt, it isn't callable and we can now pay it back at maturity with cheaper dollars.

The US can still produce much of the worlds food supply, and instead of paying ag subsides agribusiness will expand.

In my opinion the dollar has been over valued for too long, encouraging much of the off shoring that we have seen.

I think there will be a reawakening of manufacturing and, with a tip to you, mining...

Overall, I think this is what the folks back in the early 70's had in mind when they let the dollar float...

Of course that also paved the way for OPEC and the ravaging inflation of the 70's, but we have never come close to the inflation rates that we lived through back then...

They were literally changing the price of beef on a daily basis...

I am NOT giving credit to any current, past or future administration! The American economy operates in spite of who occupies the White House or Congress. The most they can do is to get in the way. I've made and lost money under every President since JFK, and I neither blame or give credit to any of them.

Throughout the 90s and early 2000s the USD was artificially high.

Tons of cheap imports resulted in a huge current account deficit which would not allow for the dollar to be artificially propped up indefinitely. As the dollar continues to slide however and imports fall and the current account gap begins to tighten we will see renewed strength in the dollar.

That will increase exports...

We still do make a lot of stuff, including Toyota's, Honda's and a lot of other cars...

It could also draw increased interest in the manufacturing sector from foriegn investors looking to build products here cheaper...

Thomas Jefferson Quotes
"If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around them, will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered."